Chairman Vu, Vietnam's Coffee King

http://www.forbes.com

It’s ten minutes before eight on a mild morning in Hanoi, and the philosopher-king of Vietnam’s potent coffee industry is down to the last 2 inches of his first cigar of the day. Chairman Vu, clad casually and crowned in a Panama hat, is said to prefer Cohiba, but this one’s a Davidoff, “a German brand,” he says through an interpreter. He offers one, but it seems a bit early in the day.

When Dang Le Nguyen Vu isn’t running Trung Nguyen Corp. from its base in Ho Chi Minh City, he might be found at his vast retreat in the coffee-growing Central Highlands, where he has a choice of 120 horses in his riding stable.

Westerners doing business in Vietnam estimate Vu’s personal worth at north of $100 million, a mind-boggling sum in a country whose per capita income is $1,300.

On this particular day Chairman Vu, as he is often addressed, has come to Vietnam’s capital to see the prime minister and the agricultural minister to discuss the nation’s coffee policy. So he takes his morning cup and smoke at Trung Nguyen’s cafe that is near the seats of power. So near, in fact, that a few weeks later it would be cleared to make way for construction of a new ­National Assembly building.

Like many of his countrymen, Chairman Vu has his own bust of the man the Vietnamese call “Uncle Ho,” entombed not far from us this morning. But what would a communist revolutionary make of this 41-year-old capitalist?
Next Tycoons: Anindya Bakrie Assembles a Media Powerhouse In Indonesia Karl Shmavonian Karl Shmavonian Forbes Staff

Ho’s ghost might enjoy what Chairman Vu calls his “coffee doctrine.” Vietnam and most other coffee-growing nations, Vu points out, are poor, tropical countries that typically receive only $1 out of every $20 earned in the global coffee industry, with the bulk of profits going to the likes of Nestlé and Starbucks. “Why should we just follow that order?” he asks. With Trung Nguyen now exporting to 60 countries and reaching deeper into China and the U.S., Vu says, Vietnam can keep moving up in the multibillion-dollar industry’s value chain.

Uncle Ho wanted prosperity for Vietnam, says Dang Xuan Minh, who is both a member of the Vietnamese Communist Party and the founder of AVM, a firm that advises on mergers and acquisitions. Dang notes Oct. 13 is now Vietnamese Entrepreneurs Day, dated to coincide with a letter that Ho sent to Vietnamese businessmen in 1954, thanking them for their financial support of the revolt against the French.

Vietnam’s pro-business spirit, he points out, was recently celebrated in “Entrepreneur’s Life,” a song and video that features the chairman of the company that makes Bulls Head Fertilizer crooning: “The country cannot be powerful without its people being rich.”

Chairman Vu stands out among a cadre of capitalists who are becoming inspirations for risk-taking in a changing society. Closely held Trung Nguyen won’t provide many financials but had sales of $151 million in 2011 and is clocking 78% growth this year, a spokeswoman says.

As its instant coffee wins customers in the potentially huge Chinese market—amid a culture that, like Vietnam, has long favored tea—Vu talks boldly of a major expansion that includes a two-year timetable to take his company public, not on Vietnam’s modest markets but on an international bourse. Within the company Vu pushes a battle plan envisioning investment of $800 million in factories and such over ten years.

Acknowledging that chronic tensions between China and Vietnam could complicate such plans, Vu points to the West’s stance. “We wish that every Chinese person would spend $1 per year for our coffee products,“ the spokeswoman explains.

---------------------------------------------------------------------------------------------------------------------------