Music has always been an important part of my life,” says Stephen Yu. “Ever since I first picked up a violin and heard its sound for the first time when I was just five, music became a lifelong passion that continues to this day.”
Yu’s path from that first musical experience would lead to becoming a commodities trader in Hong Kong and Singapore. But while successful, it wasn’t a good fit. Eager for a change, he founded Tycoon Percussion 30 years ago, which has since grown into one of the largest hand percussion companies in the world and the largest exporter of percussion from Thailand.
“In 1984, I decided the time was right to combine my desire to start my own business with my love of music,” he states emphatically. He established Tycoon as a guitar factory in Thailand when there were none, and he gained a foothold through the OEM door. The name “Tycoon” has two roots. Stephen has a son named Quincy. “His Chinese first name was ‘Thai Khoon,’ so I thought it would be a nice name for our company,” Stephen says. Prodded a bit more, he adds: “Also, growing up my family did not have much, and I always admired dedicated, educated, hard working business men, so you could say that as a child I always wanted to become a ‘Tycoon’ one day!”
The OEM guitar business was good – for a while. But by the early 1990s manufacturing was shifting to China. His choices were to move his guitar factory or do something else. He chose the latter. He saw that the percussion market was growing, and went in that direction.
“The 1990s was a golden period for hand percussion, with artists like Carlos Santana, Ricky Martin, Jennifer Lopez, and Shakira performing on hand percussion,” he reminds us. “Worldwide, it was booming.” But that observation did not alone make him worthy – and Yu knew it. He spent a challenging year retooling the factory and retraining his many workers from building guitars to building percussion, which required a seriously different skill set. “This new venture required our production team to master the techniques of manufacturing high-quality hand percussion. We brought in a few trusted professionals from outside Thailand, and took their important suggestions to heart. That was key to getting us where we are today.”
It’s pointed out that there were other, bigger players on the field at the time. What made him think there was room for Tycoon percussion?
“We knew there were unique advantages to manufacturing these instruments in our country, namely the abundance of raw material and a local workforce known to be excellent woodworkers,” Yu explains. He also saw that no named brands in this category owned a factory, which is an advantage he used in Tycoon’s favor. “This allows us to be the quickest to the market with innovative products, and we cherish the opportunity to raise the standard.”
And there was another component that he saw was missing: a full hand percussion catalog from one maker. “We did not only want to offer Latin instruments or African instruments,” he says. “My vision was to keep adding hand percussion from all corners of the world under one name – a true world percussion line.”
Challenges
A quality instrument at hand, the company then faced the challenge of getting into the crowded U.S. market. His son Quincy Yu, today executive vice president, worked to establish Tycoon in the U.S. Yu admits they faced some skeptical dealers who were apprehensive about taking on a line that was not a household name. To combat this, he says Quincy came up with some creative programs to incentivize key dealers to try the new brand. “A prime example is our ‘try before you buy’ promotion whereby dealers could stock a nice assortment of Tycoon products without paying for 180 days, costing only the floor space they take up,” Yu says. “We would even front the cost of shipping. At the end of six months, if the dealer wasn’t satisfied, they could return all the unsold products and we would even pay return shipping.” Out of the more than 50 dealers that tried it that first year, he doesn’t recall anyone sending any back, and many of those first dealers have grown with Tycoon to become key accounts.
Today, the company employs around 150 people worldwide. They have a U.S. office in Ontario, Calif. that is run by Yu’s daughter and general manager, Ivy. And just last month they started a new distribution agreement with Hal Leonard. “I could not have handpicked better people to work with than those at Hal Leonard,” Yu says. “This will allow us to focus on brand-building, marketing, advertising, product development, and artist relations – this new arrangement puts everyone in a position to do what they do best.”
Artist relations are an integral part of their company’s vision, and while they have an enviable list now including Yoel Del Sol (Yanni), Ralph Irizarry (Ruben Blades), and Alberto Reyes (Tito Nieves) among many others, Yu says this is an area that will get extra attention now that they don’t have to be concerned with distribution. “We are always looking to add new members who will add value to the team, but it’s all about finding the right people.
“At Tycoon we are all a family, from those at the factory to our sales team, all the way to the artist that play our instruments. I treat our artists like family because I am placing a big part of my company’s future in their hands and they will all contribute to shaping who and what Tycoon Percussion will become years from now.”
Hand Percussion Market – Today and Tomorrow
As to how the hand percussion market is doing, he says that while some say it’s soft right now, it really depends on geography. “Product mix needs to be tailored to the area. So while there’s been a decline of conga sales in parts of the U.S. and Europe, it’s been a strong seller in many Asian countries. Bongos and djembes continue to be popular, though they aren’t selling at all in some countries.”
Then there’s the cajon, which is a hot seller everywhere. Tycoon is getting creative with its different usages in different music genres. Yu says he’s seen a lot of bands where the drummer will get out from behind their kit to play a cajon for special a set, to name just one example. “So our R&D team has placed heavy emphasis on creating new cajon designs that will appeal to all kinds of musicians looking for different sound qualities. We know that Latin musicians want a different sound than someone who is playing pop or jazz. This is an example of a larger issue, which is that we pride ourselves on being able to cater to each inpidual musician through our extensive selection and innovative designs.”
With the company’s first 30 years behind him, Yu is looking forward. “I have built Tycoon Percussion from a small local manufacturing operation to a respectable international brand, but I know I’m still just scratching the surface of what we want to achieve as a company.
“To be honest, I’m more excited about seeing the team I’ve built and looking to see where they take the company over the next 30 years. I’m really most proud of the people we have as part of our family and they are the future of the company. I’ll always be involved providing guidance should they ask for it, but I can’t wait to see how the future shapes up for Tycoon!”
