Speaker 1: Pushkin too quick. No, it's perfect push kid stuff. You
Speaker 1: got it.
Speaker 2: Fish Mumafukuando had a dream. He wanted to turn ramen
Speaker 2: to delicious noodles, delicious noodles from something that was artisanal,
Speaker 2: that was made and served fresh in little shops, into
Speaker 2: a cheap, mass produced instant food. It's not a dream
Speaker 2: of our moment, but it was a very mid twentieth
Speaker 2: century kind of dream, which was when he was dreaming
Speaker 2: this dreamy.
Speaker 1: Age of science and age of convenience and age where
Speaker 1: where scientists could help us eat faster and more efficiently.
Speaker 2: Yes, yes, industrial food as mid twentieth century dream. His
Speaker 2: dream also, as I'll talk about in the show, a
Speaker 2: very post war Japanese economic miracle kind of dream. And
Speaker 2: so Andndo had a friend of his build him a
Speaker 2: shed out back behind his house in Osaka. He bought
Speaker 2: a used noodle making machine, brought it home on his bike,
Speaker 2: set it up in the shed, and every day for
Speaker 2: a year he is out there in the shed from
Speaker 2: five in the morning until to the next morning, trying
Speaker 2: to figure out how to make his instant ramen dream
Speaker 2: come true. He is the Thomas Edison of the instant noodle.
Speaker 1: Kind of seems like he read the Thomas Edison biography
Speaker 1: and is taking.
Speaker 2: It to heart. Yes, he's a businessman, he is not
Speaker 2: a chef, but this doesn't stop him. He tries adding eggs, starch, yams,
Speaker 2: milk powder, spinach juice. Finally he gets better at making
Speaker 2: the noodles, but he's still stuck on this last key step.
Speaker 2: How do you preserve them so that they're not fresh
Speaker 2: and gonna go bad but stable. You can just put
Speaker 2: him in the cabinet and then cook him up in
Speaker 2: an instant whenever you want them. And one day Ono
Speaker 2: ses his wife making tempura in the kitchen in the house,
Speaker 2: and he notices that the batter is giving off these
Speaker 2: bubbles of moisture in the pan, and he realizes that
Speaker 2: by frying the freshly made noodles he could dehydrate them
Speaker 2: and preserve them.
Speaker 1: Eureka, this is the moment.
Speaker 2: So he flash fries his noodles, lets them cool, and
Speaker 2: then he adds boiling hot water to the noodles, and voila,
Speaker 2: they rehydrate and cook within minutes. He has invented instant ramen,
Speaker 2: a product that human beings on planet Earth will eat
Speaker 2: one hundred and twenty three billion, with a bee servings
Speaker 2: of in twenty twenty four in the distant future. This
Speaker 2: is the story that they tell at the Cup Noodle
Speaker 2: Museum in Osaka, Japan. It's a corporate museum, a corporate
Speaker 2: museum indeed, that has a full scale replica of the shed.
Speaker 2: They also tell this story at the other Cup Noodle
Speaker 2: Museum in Yokohama, where there is another full scale replica
Speaker 2: of the shed. Maybe it's a replica of the replica,
Speaker 2: one doesn't know. But the official story, this story I
Speaker 2: just told you, leaves out some important details. Perhaps most importantly,
Speaker 2: Momofukuwanda was not the first person to figure out that
Speaker 2: you could preserve ramen by flash frying it. He wasn't
Speaker 2: even the first person to patent instant ramen in Japan.
Speaker 1: They don't want you to know this at the Cup
Speaker 1: Noodle Museum, telling.
Speaker 2: You the things they don't want you to know on
Speaker 2: business history. But look, Hoo was the guy who made
Speaker 2: the instant noodle great, who built pop Ramen and cup
Speaker 2: noodle into global convenience food superpowers, and crucially centrally, he
Speaker 2: was the guy who told his story better than anybody else.
Speaker 2: I'm Jacob Goldstein.
Speaker 1: I'm Robert Smith. This is Business History, a show about
Speaker 1: the history of business today.
Speaker 2: On the show, Ramen the foundational product, a foundational product
Speaker 2: of our modern age, fuels higher education.
Speaker 1: Absolutely PhDs only eat.
Speaker 2: Ram only Ramen, and it has a weirdly warm place
Speaker 2: in our hearts, given that it is this industrial, mid
Speaker 2: century food.
Speaker 1: Yeah, the warm place is the salt, salt.
Speaker 2: And the hot water, a hot salty water going down
Speaker 2: a lot of.
Speaker 1: The salt blood pressure. They go it up.
Speaker 2: When I was in elementary school and I was home
Speaker 2: alone in the afternoons on the weekday afternoons, sometimes I'd
Speaker 2: eat a pack of ramen raw.
Speaker 1: You ever do that? I have done it. It is
Speaker 1: It is kind of delicious.
Speaker 2: The only question is do you go flavor pack or no?
Speaker 2: Like how spicy you feeling?
Speaker 1: No, no flavor pack. My best Ramen moment was when
Speaker 1: I was in South Korea. I was watching baseball game
Speaker 1: and instead of peanuts and cracker jack, you go down
Speaker 1: to the convenience store at the stadium by a cup
Speaker 1: of ramen at hot water and then you slip it
Speaker 1: at your seat.
Speaker 2: It is remarkably ubiquitous. You know, people talk about eating
Speaker 2: it in Nigeria and in Poland, and you know, rich countries,
Speaker 2: poor countries, Asia, Europe, Africa, the Americas. Ramen has conquered
Speaker 2: the world, right instant. Ramen has conquered the world. So
Speaker 2: how did it happen? Why it happened largely because of
Speaker 2: this guy, Momo Fukuwando, So let's talk about him. He
Speaker 2: was born in nineteen ten in Taiwan. His name at
Speaker 2: the time was go Peck Huck. I'm not sure if
Speaker 2: I'm pronouncing that correctly. His parents died when he was
Speaker 2: very young. He'd later say he couldn't remember their faces,
Speaker 2: and he was raised by his grandparents. He spent his
Speaker 2: childhood in their textile store doing chores, and when he
Speaker 2: was twenty two, he went into the textile business for
Speaker 2: himself with money he inherited from his parents and at
Speaker 2: the time at the time, Taiwan was a Japanese colony.
Speaker 2: This was the first part of the twentieth century. And
Speaker 2: Ondo had an uncle near Osaka and that led him
Speaker 2: eventually to move to Osaka. Moved to Japan and set
Speaker 2: up a textile company there, and then World War Two started,
Speaker 2: which just took his textile business out of business. But
Speaker 2: one thing that will become clear about Hodo that I
Speaker 2: think is really the essence of history in some ways,
Speaker 2: is he is a hustler. He is a guy who
Speaker 2: just keeps coming up with new businesses, and he's going
Speaker 2: to come up with a lot before he gets to Ramen.
Speaker 2: So during the war, he's selling charcoal, he's selling some
Speaker 2: kind of optical equipment for the war effort. But then
Speaker 2: a manager at the factory is suspected a fraud, and
Speaker 2: apparently Ondo reports the fraud, but he ends up getting arrested.
Speaker 2: That's unclear really what happened, but it is clear that
Speaker 2: he got arrested and he's put in a cell and
Speaker 2: he sees prisoners fighting over tiny servings of food, and
Speaker 2: he'll later say this is part of his impetus to
Speaker 2: want to create this kind of cheap, abundant food. He
Speaker 2: gets out forty five days later, and not long after
Speaker 2: he gets out, Japan surrenders and the war is over.
Speaker 2: Around this time, he marries a Japanese woman named Masako,
Speaker 2: Ando takes her name. Actually, Ando changes his first name
Speaker 2: to Momofuku. Side note, as some people some listeners may
Speaker 2: have been thinking already, isn't there a fancy basically Ramen
Speaker 2: Chang food chain in America today called Momofuku. Is it
Speaker 2: a coincidence, Robert, You actually talked to David Chang, right, the.
Speaker 1: Guy, and he said it was a coincidence that Momofuku
Speaker 1: meant good peach, lucky peach. Yeah. Yeah, and so yeah,
Speaker 1: he was not basing it out of MoMA fu, or
Speaker 1: so he says.
Speaker 2: Or so he says. Surely he must have known. Anyway,
Speaker 2: So we're in post war Japan now there is a
Speaker 2: profound food shortage. In fact, the US had been, you know,
Speaker 2: deliberately cutting off japan supplies of food imports during the war,
Speaker 2: and now after the war, the harvest in Japan is bad.
Speaker 2: It's quite a desperate situation. People are eating peanutshells, they're
Speaker 2: stealing vegetables from the fields. And Ando is this entrepreneurial
Speaker 2: guy out of prison wants, you know, wants to start
Speaker 2: a business. Also, I think genuinely wants to do something helpful.
Speaker 2: So he starts getting into the food business. He finds
Speaker 2: an abandoned military base on a beach and finds a
Speaker 2: bunch of demobilized soldiers with nothing to do, and opens
Speaker 2: up a salt plant and the soldiers are working for
Speaker 2: making salt on the beach. Another company he starts extracts
Speaker 2: the marrow from discarded animal bones to make some kind
Speaker 2: of nutrition supplement. And around this time a couple things
Speaker 2: come together to plant the seeds of the big idea,
Speaker 2: the Ramen, the instant ramen idea in his mind. One
Speaker 2: the US is occupying Japan, and the US is bringing
Speaker 2: food from the US to help stave off famine. In particular,
Speaker 2: the US is bringing in surplus wheat. It's a classic
Speaker 2: American move.
Speaker 1: Yeah, because we have wheat farmers, and it's a great
Speaker 1: way to take our bounty and move it to another place,
Speaker 1: even if they don't traditionally eat much wheat.
Speaker 2: Right, And so they had eaten some bread in Japan,
Speaker 2: and before the Portuguese had brought bread, they didn't eat much.
Speaker 2: But the Americans they're bringing in this flour and turning
Speaker 2: it into white bread, which is not a normal thing
Speaker 2: in a Japanese diet. And there are these like pr
Speaker 2: vans going around, which I think means like the vans
Speaker 2: with the big speaker on top driving around being like
Speaker 2: America is giving you bread, you know, and they're putting
Speaker 2: it in school lunches and this sort of thing.
Speaker 1: You're hungry, eat some bread. Bread is good, America good.
Speaker 2: That's the gist. Yeah, so they're trying to get people
Speaker 2: to eat the bread. Ondo knows about this. And there's
Speaker 2: a moment when this is happening that is like a
Speaker 2: key moment according to him, where he's walking by a
Speaker 2: train station and he sees this long line of people
Speaker 2: and they look haggard, you know, their clothes are worn
Speaker 2: and they're kind of downcast, and it's this long line.
Speaker 2: It's like, what is this line? And he looks at
Speaker 2: the front of the line and he sees that the
Speaker 2: people are waiting to get a bowl of ramen noodle's
Speaker 2: hot broth. It just looks so good and so satisfying
Speaker 2: you would wait a long time for it. And Ondo thinks,
Speaker 2: this is ridiculous, Like we're trying to talk people into
Speaker 2: eating bread. This food people basically don't want. That is
Speaker 2: not a Japanese food. We should be turning that weat
Speaker 2: into ramen, this food that people are lining up around
Speaker 2: the block for.
Speaker 1: Which is a very smart business thing to notice. There's
Speaker 1: a huge demand for something that has a low supply.
Speaker 1: There's this large supply of bread that no one wants.
Speaker 1: I mean, it's great.
Speaker 2: So there is this sort of corporate autobiography of Ondo
Speaker 2: that talks about this moment, and he says he actually
Speaker 2: goes to a guy from the Ministry of Health with
Speaker 2: this idea, turn the weed into ramen. But he says
Speaker 2: there was a problem.
Speaker 1: At the time, however, ramen and Japanese udon were solely
Speaker 1: the domain of small scale businesses. There was no pipeline
Speaker 1: connecting us flower surpluses with the structures necessary to produce
Speaker 1: and distribute noodles. The lack of adequate manufacturing facilities amounted
Speaker 1: to a bottleneck.
Speaker 2: A bottleneck one of the things we often see in
Speaker 2: mystery of business.
Speaker 1: And you can make a lot of money if you
Speaker 1: figure out a way to solve the bottleneck.
Speaker 2: We need a printing press, but for ramen noodles, which
Speaker 2: is what he's gonna do. Yeah, I mean, ramen at
Speaker 2: this time is a craft product. I actually thought of
Speaker 2: cars before Henry Ford came along. You know, it's made
Speaker 2: in small batches, it's made fresh. It's the kind of
Speaker 2: thing we sort of fetishized today, like ooh, small batch.
Speaker 2: That sounds nice, but you're not going to feed a
Speaker 2: hungry nation with it. You just can't turn these shiploads
Speaker 2: a wheat into ramen in this way. So Hondo has
Speaker 2: this idea, and maybe he would have solved this problem
Speaker 2: right away, but for the fact that he got arrested again, Wow, criminal,
Speaker 2: This time it was for tax evasion. For what it's
Speaker 2: worth Onndo's story is that it was a misunderstanding about
Speaker 2: a scholarship program he started for his workers. What really happened,
Speaker 2: I don't know, but again it's clear that he was arrested,
Speaker 2: his assets were seized, and this time he spent two
Speaker 2: years in prison some time.
Speaker 1: Yeah, that's a lot of time to think about, Robin.
Speaker 2: And you don't even have insant ramen to eat while
Speaker 2: you're inventcing because it hasn't been invented yet. So he
Speaker 2: gets out and now he is ready to make his
Speaker 2: big ramen breakthrough. After he runs a credit union for
Speaker 2: six years until it fails and goes bankrupt. He tries
Speaker 2: a lot of things that don't work. It's what I'm
Speaker 2: saying now.
Speaker 1: You know what I have to say. This makes me
Speaker 1: love him, not that he was some lifelong chef who
Speaker 1: wanted to perfect this culinary thing but he's a guy
Speaker 1: who tried a bunch of things. He's just looking for
Speaker 1: a way through.
Speaker 2: He just keeps working at it. Okay, now he's ready, Yeah,
Speaker 2: for going out in the shed in the backyard, supposedly
Speaker 2: having the breakthrough. This is the late fifties. By nineteen
Speaker 2: fifty eight, he figures it out. Robert Smith, let's go
Speaker 2: to the official corporate narrative.
Speaker 1: Sure you can read this on a big wall at
Speaker 1: the cup Noodle Museum. On August twenty fifth, nineteen fifty eight,
Speaker 1: chicken ramen, the world's first instant noodles, was launched. Since
Speaker 1: chicken ramen, a food ready to eat in just two
Speaker 1: minutes after adding hot water, was a product inconceivable under
Speaker 1: the conventional wisdom of the times, it was dubbed magic ramen.
Speaker 2: They may have dubbed the noodles magic ramen.
Speaker 1: Nobody else called it magic ramen. They called it magic ramen.
Speaker 2: Yes, the thing that is clear from the historical record,
Speaker 2: these noodles were not in conceivable under the conventional wisdom
Speaker 2: of the time. In fact, someone else seems to have
Speaker 2: conceived them before. Momafuguando, Robert, We've got more history, this time,
Speaker 2: not from an official corporate history, but from the book
Speaker 2: The Untold History of Ramen by historian named George.
Speaker 1: Sult, A much smaller company had already released an identical
Speaker 1: product in nineteen fifty five called Flavored Chinese Noodles, three
Speaker 1: years before the release of Chicken Ramen, but the company
Speaker 1: was forced to halt production after a few months due
Speaker 1: to weak sales.
Speaker 2: Interesting, I turned out to exhibit B a Harvard Business
Speaker 2: School case study entitled Momofukuando and the Globalization of Noodles,
Speaker 2: which points out that flash frying noodles to preserve them
Speaker 2: was a technique that had been used since the early
Speaker 2: twentieth century in.
Speaker 1: Taiwan, where he's from.
Speaker 2: Where he's from, they called this noodle dish g c
Speaker 2: yan jen pa mispronouncing. But I want to say it
Speaker 2: so I can quote directly from the Harvard Business schal
Speaker 2: case study which says Taiwanese families shipped packages of g
Speaker 2: siman to their relatives living in Japan when the country
Speaker 2: experienced post war food shortages. It seems like Momofuku Ando
Speaker 2: did not invent instant ramen. Even if he did go
Speaker 2: to the shack, he wasn't the first guy to figure
Speaker 2: it out.
Speaker 1: You know. I'm okay with that. I'm okay with that.
Speaker 1: If there's one thing I've learned during this show, it's
Speaker 1: that you know, invention is fine. Invention's great. I'm glad
Speaker 1: there are inventors out there, but ideas are plentiful and
Speaker 1: execution is rare.
Speaker 2: Yes, when we did that story about Edison and the movies,
Speaker 2: we talked about the similar theme. Right. Edison basically did
Speaker 2: not invent the movies, but he got credit leased in
Speaker 2: America for inventing the movies. And when we talked about that,
Speaker 2: we talked about Joseph Schumpeter, the famous economists of the
Speaker 2: guy who came up with the term creative struction, which
Speaker 2: they love today in Silicon Valley, and he wrote beautifully
Speaker 2: about the difference between inventors and entrepreneurs, which is what
Speaker 2: we're talking about here.
Speaker 1: So so give us that as long as they are
Speaker 1: not carried into practice, inventions are economically irrelevant. And to
Speaker 1: carry any improvement into effect is a task entirely different
Speaker 1: from the inventing of it, and a task moreover requiring
Speaker 1: entirely different kinds of aptitudes. It is therefore not advisable,
Speaker 1: and it may be downright misleading to stress the element
Speaker 1: of inventions as much as many writers do or podcasts do. Yeah,
Speaker 1: we do.
Speaker 2: That's us. We are stressing it too much because the
Speaker 2: inventor is so fun, right, Like, yes, execution is what matters,
Speaker 2: but like the guy in the shed, try to try
Speaker 2: to come up with how to do it.
Speaker 1: That is delightful. I think we like the lesson that
Speaker 1: anyone can be struck by lightning. The light bulb goes off,
Speaker 1: You come up with an idea and change the world.
Speaker 1: If the real story is now you have to actually
Speaker 1: work hard and do all the hard implementation things to
Speaker 1: change the world. Well, that's not as much fun. That's
Speaker 1: just a job, this drudgery.
Speaker 2: And I used to think, I mean Edison, the guy
Speaker 2: who more than anybody created the inventor narrative, you know,
Speaker 2: is famously has one percent inspiration ninety nine percent perspiration.
Speaker 2: And I used to think that was like what you
Speaker 2: need to get to the invention. But no, it's what
Speaker 2: you need after the invention to get to business success.
Speaker 2: Like once you have the idea, all of the work
Speaker 2: is before you. And I used to think that the
Speaker 2: myth of the inventor was an American thing or a
Speaker 2: Silicon valley thing. But this story suggests that no, it
Speaker 2: is in fact a global human thing. We love an
Speaker 2: origin story, we love an inventor, and so Ando was
Speaker 2: apparently not the inventor creating magic noodles out of one
Speaker 2: percent inspiration, ninety nine percent perspiration and one percent cooking oil.
Speaker 2: I know that is one hundred and one peralt and
Speaker 2: you got.
Speaker 1: You've got the secret recipe.
Speaker 2: But he was. He was a great entrepreneur. He was
Speaker 2: the guy who brought instant ramen to the world, which
Speaker 2: we will talk about after the break. Mama fuku Ono's
Speaker 2: first instant ramen. It does seem like it was good ramen.
Speaker 2: It's called chicken ramen because he actually cooked in some
Speaker 2: way cooked the noodles in chicken broth before he flashed
Speaker 2: fried there.
Speaker 1: Oh, the flavor was big.
Speaker 2: Flavor was fried right in and so there was no
Speaker 2: flavor packet.
Speaker 1: Initially.
Speaker 2: You just add the hot water and you and there
Speaker 2: was in the block of noodle. It was a block
Speaker 2: of noodles like now in a top ramen pack but
Speaker 2: it had a little divot on top, and the idea
Speaker 2: was you crack an egg into that divot and then
Speaker 2: you pour the hot water over the whole thing, and
Speaker 2: the egg kind of poaches while the noodle cooks.
Speaker 1: I like that.
Speaker 2: Bring that one back. Yeah. He calls his ramen company
Speaker 2: Nissin Foods. The official story is that the new name
Speaker 2: symbolizes his desire to create a rich flavor purely each day,
Speaker 2: because Nietzsche means day and chin means pure. Now, we
Speaker 2: could talk about Hondo making instant ramen in his house
Speaker 2: with his family, hundreds of packs a day. We could
Speaker 2: talk about him putting on a suit and doing a
Speaker 2: demo at a fancy department store in Tokyo, calling out
Speaker 2: to passers by. Those things really happened. But you know
Speaker 2: what I want to talk about. I want to talk
Speaker 2: about Momofuku's real edison move suing all his rivals.
Speaker 1: Oh so good.
Speaker 2: First, he tries to trademark the chicken ramen name in
Speaker 2: late nineteen fifty nine and finds they're already thirteen other
Speaker 2: companies making a similar product under that name. Goes to
Speaker 2: court wins exclusive rights to the name. Next problem, somebody
Speaker 2: else has already patented his flash frying method. Another guy
Speaker 2: who was born in Taiwan actually and had been running
Speaker 2: a noodle shop in Japan, for years by that point,
Speaker 2: and so Ando negotiates with the guy winds up buying
Speaker 2: the patent. And according to that HBS case study, the
Speaker 2: contract apparently included a provision not to talk publicly about
Speaker 2: any relationship to Momofuku's Chicken.
Speaker 1: Ram He's already building up the myth.
Speaker 2: He's already building up the myth. First rule of buying
Speaker 2: up intellectual property rights. Don't talk about buying up intellectual
Speaker 2: property rights. But I guess somehow the world leaked anyways,
Speaker 2: because a newspaper asked Ando about this deal. Here's what
Speaker 2: he said.
Speaker 1: I am not thinking about monopolizing the instant Ramen business.
Speaker 1: I want to authorize the use of the patent by
Speaker 1: companies with excellent facilities and technology. If it could we
Speaker 1: used to prevent surplus production and sharp price drops. I
Speaker 1: believe that the industry can be stabilized. You're saying, I
Speaker 1: want to share the miracle that is instant Ramen.
Speaker 2: This sounds like JP Morgan to me. You know, monopolies
Speaker 2: in nineteen hundred, why do we have all these steel
Speaker 2: companies competing with each other and making a chaotic market.
Speaker 2: Wouldn't it be much better if one steel company sold
Speaker 2: all the steel in an orderly fashion.
Speaker 1: I'm not hitting for the bunny. I mean it to
Speaker 1: prevent surplus production of ramen.
Speaker 2: So Ando starts threatening rivals with patent violation lawsuits, reaches
Speaker 2: agreements with twenty companies to share patent rights in exchange
Speaker 2: for a portion of their revenues. They're all kind of
Speaker 2: banding together. Some of the other ramen companies, they're a
Speaker 2: lot by this point, hold out and form their own cartels.
Speaker 2: And in the end the government gets involved and broker's
Speaker 2: a deal. Are they fighting in the streets, like do
Speaker 2: they go and hitting each other over the head with
Speaker 2: drive noodles?
Speaker 1: They go to the factory and break all the news
Speaker 1: in the little pieces.
Speaker 2: In the end, the government gets involved, broke as a deal,
Speaker 2: and there there wind up being three ramen cartels. Onto is,
Speaker 2: you know, kind of at the center of one of them.
Speaker 2: This is important. There is a bigger idea here. This
Speaker 2: is a Japanese economic miracle idea. Right these decades, the
Speaker 2: decades after the Second World War, Japan has this period
Speaker 2: of incredible growth and the government is quite involved. It
Speaker 2: is not free market growth like we might idealize it
Speaker 2: in the United States. The Japanese government is doing in
Speaker 2: a lot of industries what it is doing in Ramen.
Speaker 2: It's managing the economy so that there is some competition.
Speaker 1: You want competition because you want innovation, you want people
Speaker 1: to feel motivated every day.
Speaker 2: But there is a limit to that competition too much,
Speaker 2: you know what. You don't want to drive people out
Speaker 2: of business, no profit whatsoever. Yeah, that is the government's
Speaker 2: point of view. Whether that is optimal or not, we
Speaker 2: can debate.
Speaker 1: It worked for a lot of East Asian countries around
Speaker 1: this time.
Speaker 2: It did. Indeed, this all comes together in a real
Speaker 2: interesting way in nineteen fifty nine. So you know, right
Speaker 2: at the beginning for Ando's business, when he realizes he
Speaker 2: needs a distribution partner to scale, and he partners with.
Speaker 1: Mitsubishi Giant industrial conglomerate.
Speaker 2: Giant and had been around in Japan for a while
Speaker 2: at this point.
Speaker 1: I mean cars obviously, but what else, probably finance, probably
Speaker 1: all sorts of actual steal.
Speaker 2: I mean, we'll talk more about Mitsubishi in particular, but
Speaker 2: let me just talk about where it fits in the
Speaker 2: Japanese economy because it's it's it's exactly how the Japanese
Speaker 2: economy works, and so before World War Two, Mitsubishi was
Speaker 2: this giant, family owned conglomerate did basically everything, and there
Speaker 2: were a few of these in Japan. Mitsui was another one.
Speaker 2: And then after the war, the Americans came in and
Speaker 2: essentially took over running Japan, and they were like, what
Speaker 2: is this. This is not how we run an economy,
Speaker 2: and they broke up these family owned conglomerates like Subishi.
Speaker 2: But then after the Americans left, these firms started to reassemble,
Speaker 2: but in a different way. Rather than a single family
Speaker 2: controlling everything, which you had was this association of different
Speaker 2: companies that had similar names, like maybe they all had
Speaker 2: Mitsubishi in the name, and they all owned stock in
Speaker 2: each other and coordinated with each other. This was called
Speaker 2: a keretsu keretsu, and so Mitsubishi was a caretsu, which
Speaker 2: meant it was a bunch of different companies that made
Speaker 2: steel and chemicals and cars and trucks and ships and planes,
Speaker 2: and that sold life insurance, and that was in the
Speaker 2: shipping business and did the import export. And at the
Speaker 2: center of it all was a bank, a bank that
Speaker 2: financed all these other businesses, which was key because bank
Speaker 2: capital was the key driver of the economy. At that point,
Speaker 2: there was not some robust venture capital system like.
Speaker 1: We have today.
Speaker 2: There was not a giant stock market where you could
Speaker 2: just go get money from the market for a new company.
Speaker 2: And I will note that today the biggest bank slash
Speaker 2: financial services firm in Japan is Mitsubishi UFJ Financial Group.
Speaker 1: Similar to what Warren Buffett did, which is if you
Speaker 1: have a lot of different businesses, having the ability to
Speaker 1: allocate capital between the different companies, who's doing well, who
Speaker 1: needs it? You know, who's generating cash, who wants more cash.
Speaker 1: If you can do that correctly, you can build all
Speaker 1: those businesses and grow faster than your competitor.
Speaker 2: And is it right, Robert that the insurance company that
Speaker 2: is at the center of Berkshire Hathaway is the kind
Speaker 2: of capital you know, using the float like I've heard that?
Speaker 1: Is that true? Yeah? A lot of them excess cash
Speaker 1: is coming from the insurance companies.
Speaker 2: And financing these other businesses.
Speaker 1: Yeah.
Speaker 2: And this works for the Japanese economy. And it's an
Speaker 2: interesting kind of capitalism, right. It's not just one company,
Speaker 2: it's a few big companies guided by the government. The
Speaker 2: government is quite involved in sort of what they're financing,
Speaker 2: and you know, the Bank of pan is standing behind
Speaker 2: these banks at the center of the Kretzus and you
Speaker 2: get decades of extraordinary economic growth out of this system, which.
Speaker 1: Sort of makes sense if you're talking about cars or
Speaker 1: trucks or building transformers. Seems a little weird that instant
Speaker 1: ramen would fit into this giant industrial system.
Speaker 2: Ondo had a pitch about that. You know, he's this
Speaker 2: little Ramen guy going to this giant global behemoth, and
Speaker 2: his pitch is much bigger than just noodles. He's thinking big.
Speaker 2: He says, Look, we're getting all this surplus wheat from
Speaker 2: the US, a great deal on our key input for
Speaker 2: our wheat noodles. The key thing for the Mitsubishi executive is, yeah,
Speaker 2: this is import. This is you know, we can get
Speaker 2: in on these wheat imports and maybe build our trade
Speaker 2: relationship with the US, because of course we want to
Speaker 2: be exporting all these things we're making to the US,
Speaker 2: and so maybe Ramen will be like a wedge that
Speaker 2: helps us build our trade relationship with the United States,
Speaker 2: which could be huge for US. And so Mitsubishi becomes
Speaker 2: a distributor for chicken ramen, and pretty soon Mitsubishi starts
Speaker 2: using the motto Mitsubishi from ramen to missiles. It really
Speaker 2: was another time. If you make missiles today, you don't
Speaker 2: say missiles in your ad uh.
Speaker 1: From killing you fast to killing you slow Mitsubishi.
Speaker 2: Now Ando's got his product, he's got his intellectual property,
Speaker 2: he's got his distribution. He just needs one more thing, marketing.
Speaker 2: And if we know one thing about Mama Fukuwando, it
Speaker 2: is that the man knows how to market. His first
Speaker 2: move and I love this, he pushes instant ramen as
Speaker 2: health food.
Speaker 1: Why not?
Speaker 2: Why not? The original ramen packaging has the phrase build
Speaker 2: strength and a full meal boasting the highest nutrition and
Speaker 2: great taste. And at the time there was this belief
Speaker 2: that part of the japan lost the war was that
Speaker 2: the American diet made American stronger than the Japanese diet
Speaker 2: made Japanese people rice.
Speaker 1: Bad weak good, I mean in its reduced form. Yes.
Speaker 2: In nineteen sixty Nissen adds B vitamins to its ramen
Speaker 2: and is allowed to market chicken ramen as a government
Speaker 2: certified special health food. Okay, okay, they got a mascot.
Speaker 2: It's a little boy named Chibico. Forgiving me Chibco if
Speaker 2: I'm saying your name wrong. He's got blonde hair, freckles,
Speaker 2: and a baseball cap.
Speaker 1: He's a little American boy.
Speaker 2: He's a little American boy. Going back to this idea
Speaker 2: that the you know, in post war Japan, the ideal
Speaker 2: of kind of health and strength was American. They sponsored
Speaker 2: a TV show. There's a chicken Ramen song that was
Speaker 2: a hit that alas I couldn't find online.
Speaker 1: You know, I'll say it.
Speaker 2: If anybody listening knows the chicken Ramen song, email us
Speaker 2: a voice memo of you singing it. We will put
Speaker 2: it on business history at pushkin dot FM. Please all
Speaker 2: this marketing works. Japan loves instant ramen. Nissen is doing
Speaker 2: great in Japan, but Momofuku always wants more. He wants
Speaker 2: to grow. He has an entrepreneur's heart. He doesn't just
Speaker 2: want to succeed. He wants more. That is the fundamental desire.
Speaker 2: So in nineteen sixty six he flies to California to
Speaker 2: figure out how to sell ramen to the United States
Speaker 2: of America.
Speaker 1: I picture a madman esque scene of Momafuku ando in
Speaker 1: his suit with a stack of ramen by the pool.
Speaker 1: Everyone like, go, go, dancers in the sun.
Speaker 2: You know where he goes. I respect him for this.
Speaker 2: He doesn't go to the pool. He's not there to
Speaker 2: you know, dine out on the expense account. He goes
Speaker 2: to a supermarket, a supermarket in La in Los Angeles
Speaker 2: and gives a few of the buyers at the store
Speaker 2: samples of chicken ramen to try, and he watches as
Speaker 2: they get paper coffee cups, break the noodles in half
Speaker 2: to fit in the cups, pour hot water on, and
Speaker 2: then eat ramen with forks while they're standing up. Americans Americans,
Speaker 2: And you could imagine him being scandalized by this. You
Speaker 2: don't break the noodles, you don't eat them standing up,
Speaker 2: you don't eat them with a fork.
Speaker 1: There's a ceremony to this.
Speaker 2: But Momufuku is not scandalized. He doesn't care what the
Speaker 2: norms are in Japan. He wants to sell noodles to Americans.
Speaker 2: He's an entrepreneur, not a chef. He wants to make
Speaker 2: the noodles in whatever way people will buy them. Here's
Speaker 2: what he writes about it later.
Speaker 1: It seems obvious, but I was reminded that Americans do
Speaker 1: not eat with chopsticks and raben bowls. I believe that
Speaker 1: deliciousness has no borders, but there's a cultural barrier to
Speaker 1: eating habits. This is smart. Yes, we don't have a
Speaker 1: tradition of what do you do with a block of noodles?
Speaker 1: You put in a paper cup.
Speaker 2: So he's sitting there watching those guys eating their noodles
Speaker 2: out of a cup noodles, cup, cup noodles, cup noodles,
Speaker 2: Robert Smith, where is this going?
Speaker 1: He invents cup noodles. He puts the noodles in the cups.
Speaker 1: Sell the cup too. You could charge an extra dollar.
Speaker 1: Thirty cirty cents is closer to it.
Speaker 2: Yes, he invents cup noodles, which in various times and
Speaker 2: places is also called cup noodle and cup o noodles.
Speaker 1: In Ireland it was called cup o noodles. I'm just joking.
Speaker 2: I will say cup noodles is not entirely trivial to
Speaker 2: figure out, and this one, as far as I know,
Speaker 2: ando did figure out. I direct your attention now to
Speaker 2: us patent three nine nine seven six seven six a
Speaker 2: instant cooking cup to noodles and a method of producing same.
Speaker 1: Ooh okay, let me read this. The denser top portion
Speaker 1: of the lump prevents the lower portion from losing heat
Speaker 1: and remaining unswelled. Thus you formally heated and swelled noodles
Speaker 1: are achieved. The flat, dense top of the lump can
Speaker 1: advantageously have placed thereon dried meats, vegetables, et cetera, which
Speaker 1: will not fall into the lump and will therefore present
Speaker 1: colorful and tasty appearance. This is complicated. So what we
Speaker 1: did is we actually took a cup noodles and we
Speaker 1: cut away the side. Tell me what's innovative about this
Speaker 1: that we see.
Speaker 2: By the way, if you're listening, you can see this
Speaker 2: happening on YouTube. So yes, So there is something, Robert
Speaker 2: that you didn't describe that is part of the innovation
Speaker 2: here that is elsewhere in the patent, and that is
Speaker 2: if you cut, if you make a cross section of
Speaker 2: a cup of cup noodles, as you have done here,
Speaker 2: you actually see that the block of noodles is suspended
Speaker 2: in the middle of the cup. There space at the
Speaker 2: top and at the bottom. I did not know there
Speaker 2: was space at the bottom of the bottom. They are
Speaker 2: not trying to rip you off. This is not non
Speaker 2: functional slack fills. It's called in the trade. This is
Speaker 2: functional slack fill because what it means is two things. One,
Speaker 2: it gives space for the noodles to expand in both directions.
Speaker 2: But the space underneath means the water goes through and
Speaker 2: then the steam comes up and cooks the noodles. That
Speaker 2: is part of the genius. And it's really quite something
Speaker 2: to look at. It really does look like a beautiful
Speaker 2: industrial food when you cut it open from the side.
Speaker 1: Genius And this was an actual invention a MoMA or
Speaker 1: his team.
Speaker 2: His name is on the patent and I think it
Speaker 2: was him, Robert put the cup noodles down.
Speaker 1: We're going to go on with should get the noodles
Speaker 1: to the precise size to put it.
Speaker 2: It's incredible. I think that's in the patent. Actually a plug.
Speaker 2: I think they might call it a plug noodle plug.
Speaker 2: Onto actually rolls out cup noodles first in Japan in
Speaker 2: September of nineteen seventy one, and it does okay, But
Speaker 2: it's not a thing that people in Japan have been
Speaker 2: clamoring for. You know, he was in tired to invent
Speaker 2: it for American leaders. But a few months later, in
Speaker 2: February of nineteen seventy two, cup noodles has its big
Speaker 2: moment in Japan, and it is not the big moment
Speaker 2: that I would have expected. We'll talk about that in
Speaker 2: just a minute. We're back from the break. It's nineteen
Speaker 2: seventy two. Cup Noodles is about to have its big moment,
Speaker 2: and here's what happens. Members of a radical leftist student
Speaker 2: group in Japan called the United Red Army have an
Speaker 2: internal purge. We promise it's about rawman, it's about cup nuts.
Speaker 1: So leftist student group, radicals, they have an internal perch.
Speaker 2: They kill fourteen of their own group's members, along with
Speaker 2: an innocent bystander. The cops are after them, the chases on.
Speaker 2: They flee to a vacation lodge in a resort town.
Speaker 2: At some point they kill two police officers and they
Speaker 2: hole up in this lodge and they take the lodge
Speaker 2: manager's wife hostage, and now there is a ten day
Speaker 2: long hostage standoff. You may be asking yourself, what was
Speaker 2: the deal with this radical leftist student group. I don't know.
Speaker 2: I don't know anything about radical politics in Japan in
Speaker 2: the nineteen seventies. But if you were asking yourself what
Speaker 2: does this have to do with cup Noodles, then you
Speaker 2: are in luck.
Speaker 1: Because we're business history, not radical student movement history.
Speaker 2: The hostage standoff was broadcast live on TV. Basically, everybody
Speaker 2: in Japan is watching this all the time. On and
Speaker 2: his company had been trying to get people in various
Speaker 2: jobs to eat cup noodles, trying to show them it's
Speaker 2: a very convenient food if you're busy, if you're on
Speaker 2: the go. And what everybody in Japan saw as they
Speaker 2: were glued to their TVs during the hostage standoff was tough,
Speaker 2: grizzled Japanese police officers fighting cold and hunger and eating
Speaker 2: cup noodles. Eventually, the heroic police officers, fueled by courage
Speaker 2: and cup noodles, storm the lodge in a morning raid
Speaker 2: and capture the killers. And now cup noodles is a
Speaker 2: phenomenon in Japan. It's in vending machines in Tokyo office buildings,
Speaker 2: second best selling vending machine item after Coca Cola. And
Speaker 2: it's time for cup noodles to go to America. Ondo
Speaker 2: had been selling in America by this point. He had
Speaker 2: started Nissing Foods USA in nineteen seventy, which was a
Speaker 2: joint venture with another food company and his old pals
Speaker 2: at Mitsubishi Good Friends to have shout out Kiretsu, and
Speaker 2: as a baby step, they had started selling a packaged
Speaker 2: drawmen under the brand name top Ramen. It's like the
Speaker 2: top ramen you get today. It didn't do great. The
Speaker 2: cup was the big breakthrough in America. For the US.
Speaker 2: They call it cup O Noodles. They add pork and
Speaker 2: beef flavors, and they make the noodles much shorter than
Speaker 2: the noodles in the Japanese version, half the length. I
Speaker 2: remember'd seen them breaking it. The Harvard Business School case
Speaker 2: study actually explains why the noodles are shorter in the
Speaker 2: American version in language that just delikes me, so I
Speaker 2: want you to read it.
Speaker 1: So the consumers would not have to make a slurping
Speaker 1: sound while eating the product, whereas slurping was regarded as
Speaker 1: part of good eating manners in Japan. The noise was
Speaker 1: highly objectionable to many people in the United States.
Speaker 2: Americans loved their broken in half noodle cup O noodles.
Speaker 1: Just a little slurp, not a big slurp.
Speaker 2: Now got Japan America Anddo and Nissin are off. They're
Speaker 2: going to take over the world with instant noodles, and
Speaker 2: you see this decade after decade they go from country
Speaker 2: to country, opening factories, adapting the cup to suit individual tastes.
Speaker 2: There's Chirosco in Brazil, Crab in Hong Kong, Tamyam in Thailand,
Speaker 2: Masala in India, Miria in Mexico. You can actually get
Speaker 2: that in the US now.
Speaker 1: And it sounds delicious, and this is genius. This is
Speaker 1: a great thing about cup noodles. You can put any
Speaker 1: flavor you want in there.
Speaker 2: They're incredibly ubiquitous. Nissan sells something like two billion cups
Speaker 2: of cup noodle a year. Worldwide. People eat one hundred
Speaker 2: and twenty billion servings of instant ramen per year. That's
Speaker 2: all companies, and of course the researchers in Antarctica will
Speaker 2: eat it there. Basically on every continent people eat instant
Speaker 2: ramen like it is extraordinary wide it has spread, and
Speaker 2: you know, it's also literally across the street from my house.
Speaker 2: Like this morning, I'd been meaning to pick up cup
Speaker 2: noodles as props for the show. I'd forgot, and this
Speaker 2: morning I went to the bodega that is across the
Speaker 2: street from my house, and of course they had it.
Speaker 2: And it is not a big bodega. It's smaller than
Speaker 2: the media in seven to eleven in America. And it's
Speaker 2: not particularly cheap, right bodega's, You're pay a little more
Speaker 2: for the convenience. Two cup noodles were available in abundance
Speaker 2: across the street from my house. Two of them cost
Speaker 2: me three dollars.
Speaker 1: In New York City, you could never be more than
Speaker 1: fifty yards from a cup.
Speaker 2: Noodle, truly, and I suspected much of the world. Mamufukuno's
Speaker 2: last big move was space ram ram and specially designed
Speaker 2: to be eaten in space. He and his team designed
Speaker 2: the noodles to be held together with egg whites to
Speaker 2: cook at a lower temperature because there's not that much
Speaker 2: pressure on a spaceship, so right, so water is gon
Speaker 2: boil at a lower temperature. And in two thousand and five,
Speaker 2: a Japanese astronaut eight space rom in space and it
Speaker 2: made news around the world.
Speaker 1: Momofuku Ando understood the power of a good story. And
Speaker 1: that's just a great story. So good, what do they
Speaker 1: sell one of those space? But it doesn't it doesn't matter.
Speaker 1: We don't care if this is I don't know a
Speaker 1: true story. That he was in the shack and all
Speaker 1: this stuff. What we care about is that there is
Speaker 1: a miracle in the world, and we just want a
Speaker 1: little story that makes us feel better, you know, that
Speaker 1: makes us feel warm and toasty inside, much as the
Speaker 1: hot water does to the noodles in the cup.
Speaker 2: Two years after the Astronaut eight space rom in Space,
Speaker 2: Momofuku Ando died at age ninety six.
Speaker 1: He had no more worlds to conquer.
Speaker 2: He said the secret to long life was golf twice
Speaker 2: week and chicken ramen every day.
Speaker 1: Don't do it.
Speaker 2: His funeral was space themed, was held at a stadium
Speaker 2: in Osaka. Two former prime ministers attended, and it was
Speaker 2: a celebration of the life of the man who, as
Speaker 2: everyone knows, we've heard the story invented instant ramen. What
Speaker 2: food should we do a story about? Tell us? You
Speaker 2: can email us at Business History at pushkin dot fm.
Speaker 2: You can find me on Twitter aka x or on LinkedIn.
Speaker 2: Robert you are at Radio Smith, keeping the radio alive
Speaker 2: one day at a time. Our show Today was produced
Speaker 2: by Gabriel hunter Cheng. It was engineered by Sarah Buguer.
Speaker 2: Our video editor is Matt Nielsen. If you want to
Speaker 2: see a cross section of cup noodles. You can see
Speaker 2: it on our YouTube page. Our showrunner and our editor,
Speaker 2: and a man who calls cup noodles pot noodles I
Speaker 2: think is Ryan Dilly. I'm Jacob Goldstein, I'm Robert Smith.
Speaker 2: Thanks for listening.