You would rarely meet anyone who has a strong passion for mushrooms. To most people, it’s just a side dish in a meal that barely makes a difference whether you have it or not.
But the founders of Mushroom Kingdom, Janson Chan, Jay Neo and Philbert Khoo, love the fungi food so much that they uprooted themselves from the finance industry to start a business around it in 2016.
If you’re thinking: “what’s the big deal about mushrooms?”, well, their friends and family attempted to dissuade them with the same skepticism too.
Janson tells us his friends would raise doubtful remarks, saying this business wasn’t possible.
[To them, they believed] the mushroom market was very small and mushroom farming was hard work. They did not see farming to be a respectable business.
The discouragement was probably an even sharper jab coming from his mother, when she still asked him to “just go for a stable job after [he had] started the business”.
Despite the tough beginnings, we fast forward to 2019—their now 3-year-old company is supplying to restaurants like Haidilao, and sells a line of mushroom chips across 7-Eleven stores islandwide.
Into The Mushroom Kingdom
Sometimes it takes a little bit of coincidences to get a spark going, and Mushroom Kingdom was a class example.
What are the chances three guys (all 33-years-old) would cross paths in the financial sector, but also all share the same deep love for mushrooms?
Janson first met Jay more than 10 years ago at an entrepreneurship programme. While Jay later went into a career in financial education abroad, Janson started working in a bank where he got to know Philbert as a fellow trainee.
As the trio became friends, they dabbled in an e-commerce startup together, and that was when a brand selling mushrooms piqued their interest.
First they sang praises of its “umami flavour”, then their admiration for the humble mushroom grew when they began studying its health benefits.
In no time, they soon realised their eating habits had all changed.
“I instinctively choose products that are made with mushrooms, like mushroom noodles or mushroom soup,” Janson laughs.
They began looking into the possibilities of a business opportunity here, and eventually found that many modern Singaporeans are growing in awareness for healthy living, yet often swayed to make unhealthy choices.
“It can be quite intimidating [when] many don’t know where to start. [And it doesn’t help that] they also have the perception that healthy food is bland.”
Hoping to change this, they left their jobs and started visiting farms in Malaysia to learn more about the industry and bring fresh mushrooms back to Singapore.
Their first hurdles surfaced here, adapting from their finance backgrounds, to keeping up with the importing and exporting rules between the two countries.
“As we had no prior experience in importing and exporting, we faced some challenges [in this]. When speaking with the different farmers, we hit a few walls, but somehow, managed to pull off the partnerships eventually,” Janson says.
Sustainability vs Quick Returns
With that, Mushroom Kingdom had found its supply. But running the business didn’t get much easier from there.
The toughest period was when we needed to pitch to investors, [and] we couldn’t position ourselves [as both a] sustainable yet profitable company.
Janson explains: “Agri-businesses are usually lower in profit margins and take a longer time to break even.”
The founders themselves were prepared for a long journey, as they knew they were first and foremost geared to the vision of “[defending] Singapore’s food security” and sustainability.
However, this often misaligned with what investors looked out for—shortening the timeline to when they can reap returns from their investment.
“We decided that it’s not true to our initial calling and decided not to waver to investor interest, [but to continue looking] for angels who believe in our quest [instead],” Janson says.
Although it was a tough decision to stand for, they eventually managed to raise “about $1 million” from family, friends, and their seed funder Agrivo International.
More Ways To Move Mushrooms
True to their friends’ early worries, making money from selling mushrooms was a terribly steep incline for the Mushroom Kingdom team.
The revenue from selling fresh mushroom produce has yet to meet with our expectations. If we were to factor in operating expenses, there were many months where we were operating at a loss.
To overcome the challenges of a capital intensive business with low profit margins, they had to think of ways to expand their offerings.
One way was by ‘snackifying’ healthy food to make it more attractive.
To do this, they took “over 20 rounds” of R&D and taste-tests to create mushroom chips with “the right amount of seasoning, the [right] type of mushroom, and retaining [a good amount] of crisp”.
Developing this new product also moulded the team to find a balance between tapping on trends, and staying on the healthy route.
Janson explains that they once explored salted egg mushroom chips after many customers requested for it, but hitting a good flavour required them to deep fry their mushrooms, essentially nullifying its healthy aim.
We really didn’t want to be another addictive or sinful snack that is heavy on flavour and would most probably die off after some time when a new craze hits.
Instead, they found a better opportunity to make a vegetarian ‘mala’ sauce, which is both an extremely popular food, and can be kept healthy with reduced oil and preservatives.
Since Mushroom Kingdom launched its mushroom chips in 2018, they have sold “more than 50,000 packets”.
“I’ll say entering into 7-Eleven was one of the bigger milestones for Mushroom Kingdom,” says Janson.
“It’s Through Giving, That You’ll Receive”
When asked what’s one lesson they’ve learned from running Mushroom Kingdom, the founders warmly share: “It is through giving, that you’ll receive.”
Another way they have been extending their reach is through education, where they teach people how to grow and harvest their own mushrooms.
At one of their farmers’ markets, they met a young girl who really wanted to buy their mushroom growing kit, but wasn’t able to because her mother didn’t have enough money on her that day.
“So I bought the kit and gave it to the child,” Janson says. “I got her to promise me that she will be disciplined in growing the mushrooms.”
“When her mushroom bloomed, her mother took pictures and showed them to the teacher, and then the teacher asked us to supply our kits to the school,” he adds.
Similarly, as they stuck to their guns with dedication to their work, Mushroom Kingdom started to get noticed—even by one of the shareholders of popular hotpot chain Haidilao.
Through this, they got a referral to Haidilao’s procurement officers and invited them to visit their farm.
It was a success for the mushroom farmers as Haidilao was pleased with their growing methodology and decided to start ordering from them.
Not resting on their laurels, the Mushroom Kingdom founders have many upcoming plans to work towards.
In line with their hopes to help Singapore gain more food security and independence, they’re looking into setting up a farm “closer to home”, as well as a manufacturing plant to produce more dehydrated mushroom products in larger quantities for health conscious consumers.
Exporting overseas is also something they’ll be eyeing in the future!
Featured Image Credit: Mushroom Kingdom