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SELLING A BUSINESS

The Candyman's Saga to Hit the Big Screen

David Klein, the inventor of Jelly Belly jellybeans, talks about the new film Candyman, which documents his rise and fall.
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David Klein is a testament to the fact that every entrepreneur with a fresh idea should invest in a good lawyer. In 1976, Klein came up with a new kind of jellybean, which would come to be known as Jelly Belly. To bring the idea to market, he partnered with the Herman Goelitz Candy Company. Four years later, the company was cranking out one million pounds of jellybeans per year, but Klein's relationship with the company began to deteriorate. The whole saga is detailed in the documentary Candyman, which premieres at the Slamdance Film Festival in Park City, Utah, on January 24. Klein recently spoke with Inc. reporter Josh Spiro.

What were jellybeans like before you came around, and how did you see a way to change them?
In 1976, I was a candy and nut distributor. My wife Rebecca and I had one child, Bert, and $800 to our names. I wanted to open up a store that just sold jellybeans, and I needed something different than what was on the market. At the time, all jellybeans sold for less than a dollar per pound, and they all tasted pretty much alike. My idea was to  use natural flavoring whenver possible, and to flavor the inside of the bean as well as the shell. I also wanted to make jellybeans that were smaller—around 400 beans to the pound—and sold at a higher price. That was the concept behind Jelly Belly jellybeans.

Was it an instant success?
To be honest, I could not give them away for the first few months. They were selling for $2 per pound and people laughed at me. Even my regular candy and nut customers would not buy them. If I had not received publicity the product would have died.

What sort of publicity?
I called up the Associated Press and talked to the editor of the business department. I told him that I had the only jellybean store in the world. I also told him that we were doing tons of business. This was not true. When he paid a visit to us, I had friends come in to buy the product while he was there. After the article appeared nationwide, the product was on its way. 

Where did the name come from?
I used to watch Sanford and Son. I heard a reference on one show to the blues musician known as Lead Belly. This inspired the name Jelly Belly. I did not know it at the time but Lead Belly had spent time in jail for attempted homicide.

In the trailer for the new documentary on your life, Candyman, you say that coming up with the idea for Jelly Belly ruined your life? Why?
I made a mistake and sold the trademark to the Herman Goelitz Candy Company. The idea to sell it did not originate with me. I never wanted to part with it, and I've always regretted it. People asked me how could I have been so stupid as to sell this trademark. The documentary goes into great depth to show just why I could not be called Mr. Jelly Belly anymore.

What was your initial arrangement with the manufacturer, and why did you part ways?
At the very start, all the product was sent to me. I paid the company 59 cents per pound until I called them up and told them to charge me 10 cents per pound higher. I know that this is seldom done in business but I was making plenty of money on the product and I wanted to make sure that they were also. After a while, the company also asked to be made a distributor of the product, and we said yes. Then, they wanted to take over the trademark, and we reluctantly accepted. When we parted ways, they paid us $20,000 per month for 20 years, a period that ended in 2000. I have received no money since then. By the time I split the money with my partner and paid taxes, there was never much left to start a new business.

Are there any other inventions you've come up with, candy-related or otherwise?
As a matter of fact, yes...I was the inventor of many sour products such as gumballs and licorice. I also came up with the idea for Snot, which was a plastic nose filled with liquid.

I understand your daughter caught the bug for creating new types of candy too. What has she invented?
Since she was 4 years old, Roxy was always trying to come up with a candy idea. I always encouraged her to use her mind. A great idea sometimes comes out of a bad one. So I always say that there is no such thing as a bad idea. When Roxy was in high school she had this sand art creation in her room. She kept on looking at it. One day she asked me if we could make a candy powder that looked like sand art but the kids could eat it too. Sandy Candy was created from this idea and I am proud to say that Roxy took this idea and made it into an international business.

Last updated: Jan 22, 2010




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