BRAND SECRETS AND STRATEGIES

PODCAST #148

Hello and thank you for joining us today. This is the Brand Secrets and Strategies Podcast #148

Welcome to the Brand Secrets and Strategies podcast where the focus is on empowering brands and raising the bar.

I’m your host Dan Lohman. This weekly show is dedicated to getting your brand on the shelf and keeping it there.

Get ready to learn actionable insights and strategic solutions to grow your brand and save you valuable time and money.

LETS ROLL UP OUR SLEEVES AND GET STARTED!

Dan Lohman: Welcome. Have you ever heard the term edible recycling? That's what this podcast is about. A lot of people today are talking about food waste and reducing our impact on the environment and on the planet. This podcast features a lot of those conversations. Today is no different. Today we're talking about edible upcycling. In other words, taking a product that was thought to be waste and then turning it into something useful.

Have you ever heard the story about those pressed logs, those fire logs? I think it's a fascinating story, and it kind of helps frame this conversation. A lot of sawmills were just throwing away sawdust. They had no use for it, and actually, it was a fire hazard, and it was even a problem for them. Well, someone had the bright idea that if they took it, compressed it into a log, that it could be reused again as a log for a fireplace. Now that story is kind of old, but I remember it was one of the first times I heard about someone coming up with a creative new use for what people thought of as waste. Think about all the things people recycle today, cardboard, paper, you name it. Well, in addition to focusing on reducing the waste that we create, why not find a creative way to recycle other products, for example, the grain that comes out of a brewery or distillery?

My point is this, sometimes those products that we're recycling have attributes or characteristics that are unique and different from anything in the market. That's what today's story is about, finding creative ways to reuse or repurpose, or better yet, edible upcycling a product that was thought to be waste. A product that has a lot of attributes and characteristics that are really unique, for example, higher in protein and higher in fiber. Think about all the products today that are trying to make a fiber or a protein claim. Well, here's a creative solution to dramatically impact those products. In other words, have more protein and have more fiber than their traditional counterparts.

Before I go any further, I want to remind you that at the end of the episode there's a free downloadable guide for you. I always try to include one easy to download, quick to digest strategy that you can instantly adopt and make your own. One that you can use to grow sustainable cells and compete more effectively with. Remember, the goal here is to get your product on more retailers' shelves and into the hands of more shoppers, empowering brands and raising the bar. If you like the podcast, please share it, subscribe, and leave a review.

Now here's today's guest, Dan, with ReGrained. Daniel, thank you for coming on today and for making time for us. Can you start by telling us a little bit about yourself and your journey to where you're at today?

Dan Kurzrock: Sure thing, Daniel. It's always good to be on with another Daniel. It can get really nice and confusing for anyone listening.

So yeah, my name's Daniel Kurzrock. I am the co-founder and Chief Grain Officer of a brand called ReGrained. What ReGrained does, in short, is we rescue overlooked, undervalued ingredients, and we develop new supply chains around them. We call it edible upcycling. There are two main functions of the business. The primary one is as an ingredient platform, so today we work with breweries, and we'll talk more about that. We basically developed a really high protein, high fiber flour that can be used in all kinds of different applications from savory to sweet. And then we use that ingredient, which we're trying to build a market for, in our own brand of ready-to-eat consumer products. So people listening may know us for our line of nutrition bars that are out on the shelves today. We have a line of savory puffs coming out soon, and some other products in the pipeline. That's all geared towards getting people excited about a new ingredient, teaching them about upcycling and how fighting food waste can be actually a really delicious proposition. That's the high level of what we're up to. Pleased to be on the show.

Dan Lohman: Well, thank you for making time for us, again. How did you start this? I watched your video, and it was sort of the college kid's dream. Making beer, what am I going to do with this excess waste? Go ahead.

Dan Kurzrock: Yeah, a bit of a hair-brained idea in college. I learned how to make beer when I was 19. For international listeners, the drinking age in the U.S. is 21, but it's perfectly legal to buy the ingredients to make beer, so I was really excited by this concept and started making beer every week. And every time I made a batch, we would do... There are basically four ingredients in beer. There's water, which everyone kind of forgets about that one. Hops, which everyone knows. That's kind of the lead singer in beer. Yeast, which makes all the magic happens, but then malt barley, and that's what you use, by volume, the most of.

We were using about a pound for every six-pack we would make, so say five gallons at a time, which is a third of the keg, we'd have 20, 30, sometimes more pounds of barley that had basically just been soaked in water. So I was making beer every week, and in doing so, generating the food supply that I was... I was in Los Angeles. We didn't have a compost bin. We certainly didn't have a garden or farm animals or anything like that, and it felt really wasteful hauling this to the curb and basically tossing it. It felt like I was throwing away food.

No one was talking about food waste at the time, either. It was like 2009, 2010. It just made sense to me to try and do something with it. So the original concept was just to have one hobby that would fund another hobby, so I would take the grain, I would make loaves of bread, sell the bread to friends, and then use the proceeds to invest in more ingredients to make more beer. So it was kind of like a circular recreational business.

Dan Lohman: That's cool.

Dan Kurzrock: Yeah, it was super fun, and in doing so, we started asking some of the bigger questions about what the industry is doing, and this was right around when craft beer started taking off. Right now, there are more than two new breweries opening per day. At the time, it was really just starting to get going, and we thought, "Hey, what are the breweries doing with this?" The industry calls it spent grain, and it's a total misnomer because the grain is actually a concentration of all the protein and fiber. The breweries are just extracting the sugar.

And so, being entrepreneurial college students, we would try to wrap our heads around why this didn't already exist, and what our unique approach could be to seize an opportunity to build a business that can help make positive environmental change while also making a profit, and have that triple bottom line including people as well. So we grew from this hobby, and it's now a much bigger business. I ended up working with the USDA; we've worked with some very large brands, and we've got our products in thousands of stores. And I would honestly never predicted it from our roots of just making beer and asking questions.

Dan Lohman: I think that's amazing. So, you worked with a lot of different groups, like the USDA. How did that come about, and then how did you develop that relationship, and what do you do with those types of organizations?

Dan Kurzrock: Yeah, so when we think about the business that we're trying to build, this is kind of an overused term, but there is truly this ecosystem that needs to be... Stakeholders need to be involved in the business. So if you think about our supply chain, our supply chain is breweries. It's kind of like how the whey protein industry works with dairy processors, and that's where whey is made from. And then there's in the food industry, all the way through to the end consumer, right before that step, there's either the restaurants or brands that are making the products. But then in between, there's also food product developers, and ingredient companies, and things like that.

We did the math pretty early on, our own goal was to close this loop. We estimate there are 20 billion pounds of this grain available in the U.S. every year. And just by rough math, as a CPG company, if we were to achieve a hundred million dollars in sales, which is no joke, right? That's a pretty successful company at that point. We would only be able to work with one or two breweries, maybe three. There's just that much supply available. And so for us, we realized that in order to actually close this loop in the most meaningful way, it would be best to become an ingredient company and to work with other brands, and help build a new category.

So when we stopped thinking about ourselves as just a singular company, if you think about it, building a company is like building a skyscraper or something like that, as opposed to like helping support the infrastructure or municipality. We need to engage people from different ends of that value chain and create shared wins, basically.

So with the USDA, this is a very fortuitous thing that we discovered. We're in Northern California, San Francisco. And Albany, which is basically Berkeley, they have the facilities. I did a grad school program for sustainable business. One of my peers and close friends, he was doing a tour of this facility at the USDA, and it was related to the work that he was doing at the time. They had a program... It was pretty much a direct quote of what the program's called. Turning Sources of Plant-Based Waste into Novel Ingredients. Transforming Sources of Plant-Based Waste into novel ingredients. It was a very academic way of describing upcycling, right? It's exactly what we're doing.

And we had run into a scaling challenge, operationally, where we weren't really sure how we could stabilize the material from the other breweries at scale. It's a pretty volatile material. It spoils very quickly, and so worked with them on something called a co-research and development agreement, which ended up yielding a patent. We developed a new machine, effectively, that makes it viable. For the first time, really, to develop out the supply chain and build a market for a new super grain. That was the nature of that partnership. Of all the things that have been most surprising in this journey, partnering with the U.S. government, effectively, was probably the furthest flung from what I could have predicted. I mean, it was a really wonderful relationship. It's called the ARS, the Agricultural Research Service, and I think a really good example of how public-private sectors can work together to do something meaningful. And for us, that meant unlocking how we're going to actually scale this business, and also ultimately protect the business because now we have patent-pending technology powering this whole thing.

Dan Lohman: So the fact you were able to do that, first of all, kudos to you. Hat's off. I mean, that's really cool that you were open-minded enough to even consider going down this path, instead of traditional, "Here's what you do, because here's what your great grandfather did," that kind of strategy. So that's really cool that you were able to do that. So the patent that you've got, how does that work? Does that just incorporate the ingredients? And so, anyone who wants to take advantage of this technology has to come through you? Or why is that important? And then later, we'll talk about that fits in with your branding strategy, et cetera.

Dan Kurzrock: Yeah, Yeah. For sure. Our vision for how we scaled this thing is to deploy this machinery, technology, at the point of production, factories around the world. And so by having that protected, we can enter into agreements and things like that as we scale-out. This grain, when it comes out of the brewery, it's extremely wet. It's very waterlogged, like 90% moisture, which is part of why it spoils so quickly. It also means it's heavy, which makes it not only difficult to transport but more expensive to transport, right?

We wanted to come up with something that would make sense to support our vision for how this loop could be closed. The technology was an important link in enabling that, and as it ties back to the brand. Our strategy for doing this is to be a branded ingredient, so we're developing... It's not a commodity, at least not yet. So when we work with companies, they are marketing the fact that they're powered by ReGrained, or that there's ReGrained inside, like Intel inside for food, which is important for the end consumer.

All of our brand assets around upcycled and ReGrained, to the end consumer, people want products that taste great and are also better for them, and better for the planet. But with food waste, you also have this challenge of not... You want to communicate that value to them, but you don't want to yuck their yum, right? And you don't want to make them feel like they're eating waste because they're not, right? But you want them to understand that they're helping in the fight against waste, and more importantly, towards a food system that better values the resources that support life.

So that why we've built a brand to develop that market, and then starting with our own products, and then co-branded products, and then eventually wholesale ingredients at some point. We're trying to be really thoughtful about how we build this thing out because it's a new concept for a lot of people. Although it makes sense once you explain it to them, generally.

Dan Lohman: Oh, it makes tremendous sense and I think it's great that you're doing this. So the product, what we would call food waste, my impression was that went to animal feed. Is that true, because if that's now not animal feed, then do the animals now eat? And how much of that got thrown away and did not go in animal feed?

Dan Kurzrock: Yeah, it's a really good question, and we try not to talk about it as much about it being wasted, as much as finding the best use, so the highest value. There's something called the food recovery hierarchy. It's a pyramid. The profit pyramid is feeding people. It's a similar argument for having a plant-based diet, right? If you eat the plants directly, it's less resource-intensive and it's a way to keep nutrients directly within the food system. So yeah, there is a very rich history of this grain going to feed animals. With an urban brewery, it's sometimes less practical, but the majority of breweries are working with farmers. They're either donating it or selling it for almost no value.

The reality, Daniel, is that there's so much of this supply chain, that today it's not really impacting the AG sector and their ability to have feed. Frankly, there's a lot of things that are used for animal feed that could be used for human food as well. It's just a matter of thinking differently about it and deciding what we prioritize. So for us, upcycling, it's all about finding the highest possible use, the best value. It's about trying to align the food we eat with the planet we live in the most optimal way possible. And we believe that what we're doing, it ultimately creates a net benefit for everyone.

Dan Lohman: Well, and the reason I ask that question is that just trying to drill down a little bit more, and personally, I'm not a fan of feeding cows things that they weren't designed to eat, which I think we do a lot of.

Dan Kurzrock: Yeah. I wasn't going to go there, but yeah.

Dan Lohman: I wanted to go there because there's this myth that we can feed a cow anything we want. Well, if we are what we eat, then what we eat matters. And if you're putting the wrong ingredients into the cow, the milk that you're going to get is different, unique, whatever. It's not going to be the same. I had Tim Joseph of Maple Hill Creamery on, and he feeds his cow grass. Go figure. And yet, his milk is unbelievable. It's amazing. I think a lot of the food allergies, et cetera, are caused by some of the things that we've done to our food system, including feeding animals things they weren't designed to eat. Whole other conversation, but where I was going with that is now you've got something that you've re-engineered, that's not the right word, that you've upcycled, that you're using it for different use. So can you talk about the properties of the grain itself? You said high protein, high fiber. What does that mean in contrast to what people would normally use?

Dan Kurzrock: Yeah, it's a great question. So one of the things we did pretty early on, we had access to all the University's library system and things like that.

Dan Lohman: Cool.

Dan Kurzrock: Academic journals and stuff. And we found this wealth of nutritional science about how awesome as an ingredient this barley from the grain process is or could be. Literally the name of this paper, made a case for how nutritious this is, even some about how functional it can be in product development. Had a lot of papers about the flavor development and stuff, we can talk about that. It's actually a really flavorful ingredient as well. It doesn't need to be masked or hidden in any way. It's actually really nice. Feature chefs really like it.

But so what we found was there's all this research about how great this is, basically, most of the sugars have been extracted through the brewing process, so what's left is the protein, as well as dietary fiber and prebiotic fiber, mostly, which was what the probiotics effectively consume. So prebiotic fiber is really important for digestive health, even though it's not labeled as dietary fiber. It's kind of a confusing naming convention.

And there was this huge gap between this research and commercial application. So here's this ingredient that has this great story behind it, it's got great nutritionals behind it, and you've got food companies that want to make products that taste great and deliver on nutrition, that have a great story. It's kind of the supply and the demand in the marketplace, if you think about that, wasn't really talking to each other. And so, we'd now done some of our own research as well, and especially on different ways that it can be applied in recipes, and it's a pretty incredible ingredient. So compared to virgin grains that are out there, the protein level's about double that of whole wheat.

Dan Lohman: Mm-hmm (affirmative).

Dan Kurzrock: It's got something like four times the amount of fiber, dietary fiber, of oats, just to give you an idea. I mean this is a very nutrient-dense ingredient that can be incorporated into recipes. The lowest end, something like 10% of a formula, all the way up to much more than that, and it does a lot. Anyone that we work with, we unlock the fiber plan for them. You know, it's a good source of fiber, or excellent source of fiber, depending on the recipe.

We like to talk a lot about fiber because most people eat enough protein, right? We're very obsessed with protein right now as an industry. Not getting enough protein isn't really a problem in the American diet, whereas nobody gets enough fiber. Like, Daniel, do you think you get enough fiber? Do you know how much fiber you get every day?

Dan Lohman: We eat a lot. In excess, now compared to most people, so realistically, probably... I don't know. I would think like 40, 50 grams, which is probably a lot more than most people. However, to your point-

Dan Kurzrock: A lot more than most.

Dan Lohman: Well, we go out of our way to, because I understand exactly what you're getting at. Protein, and if you'll pardon the pun, is kind of like a sugar high. And let me know your thoughts. So from my understanding, it gives you a lot of what you need in terms of your building blocks, gives you the energy, and stuff like that.

However, without the fiber to go with it, that doesn't stretch the benefit of the protein out over a long period of time. It doesn't fill you up. You tend to want to eat more, et cetera. As a result, not having enough fiber is an issue. And as you get older, fiber is even more important. So what are your thoughts and what have you learned? You said you've done some research around this. Am I right?

Dan Kurzrock: Nutritional science is definitely not my background because it relates to the building blocks and things like that. I'm a little out of my depth on that, but what I do know for sure, is that we're learning more and more about gut health, right? Digestive health.

Dan Lohman: Right.

Dan Kurzrock: And the impact that can have on everything, and fiber plays a really, really important role in that. The consumer perception of fiber is generally things like Metamucil, and supplements, and the geriatric market. Young people need fiber too. Everyone needs to eat fiber, and you should get a lot. Whole fruits and vegetables, and whole grains and stuff are a great source. For example, our bar has five grams of fiber in it and you wouldn't know it. What's interesting is that we're trying to help... We're in the early stages of the trend around people really seeking out fiber, prebiotics.

It's kind of heading in that direction, we're seeing a lot more fiber gummies and things like that on the market that are geared towards the old and such. But it's something that we really want to help educate the market about because fiber is an essential nutrient that everyone is, almost everybody, is lacking. Even people that are mindful of it, generally don't know how much fiber they're consuming a day. What we're able to do is take recipes that would maybe have no fiber, and bring a good serving of fiber to it while making it a better tasting product that also has a great story. Not that the protein's not important, and not that the other nutrients aren't important, but generally when you use our ingredient relative to other grains in a recipe, one of the biggest impacts you're going to see is a significant increase in the amount of fiber on the nutritional facts panel.

Dan Lohman: Which is so important, so thank you for sharing that. Yeah, what we do, is we try to get over 10 to 15 grams of fiber per meal, and that's kind of how we do it. And the reason for that, like I said, it stretches you out. It makes you less hungry, less often. You're able to go longer, further, et cetera. You were talking about some different fibers. One of the things, I think, to your point that a lot of people look to the fiber in a container, which isn't the same. A synthetic fiber is not the same.

Earlier you made the point, you are what you eat. And so if you are eating the fibers that are synthetic, that's not going to do the same thing for you. Actually, your point was if you eat closer to the however you put it, to the grain itself, rather than eating something that has been processed, et cetera, then that's quite a bit different. So getting that rich dietary fiber, and the kind of fiber that's going to make a difference, not the kind of fiber that's just going to fill you up artificially, et cetera. Big difference.

The probiotic fiber, I think is interesting. Can you talk a little bit about that? How did you come across that? And what does that mean and how does that impact a person? Or do you know?

Dan Kurzrock: Yeah, for sure. And just to clarify, it's prebiotics.

Dan Lohman: Oh, sorry. Prebiotics. Okay.

Dan Kurzrock: So there's prebiotics and probiotics. And if you think of your digestive system, your gut, as an ecosystem, to use that overused word again, you've got your flora and your fauna, right? And the probiotics are the fauna. They're living organisms that go about their business in your gut. They consume prebiotics fiber. So it's also known as bulk fiber or non-dietary fiber, basically, it's insoluble. But it is effectively the food for the beneficial bacteria that live in your gut, so it's kind of like tending the garden of your gut or something like that.

Dan Lohman: It makes sense.

Dan Kurzrock: It sounds weird when you talk about it like that, but that's effectively the relationship between the two. There are different types of prebiotic fiber that are not, today, something that's very easily measured in terms of a gram and things like that. But it's widely considered to be very important to get a lot of prebiotic fiber in your diet as well, not just dietary fiber.

Dan Lohman: Well, on that note, I'll talk to a lot of people who have mentioned that all these products that have pre and probiotics in them, they're great, but if we eat properly all the time anyhow, meaning we provided that kind of nutrient source for that fiber, I mean for those probiotic, prebiotic, excuse me, then that would be healthy for us in the long run. So I think using-

Dan Kurzrock: Yeah, basically you shouldn't need the probiotics if you're eating enough prebiotics.

Dan Lohman: Exactly.

Dan Kurzrock: Yep. Yep.

Dan Lohman: Yeah, thank you for sharing that. It's exactly what I was getting at, is that if we eat properly, I remember years ago before Better Living Through Chemistry, I'm older than you, so I remember that. If you ate properly, then you didn't need a lot of the supplements and a lot of the things that we're eating today to augment what we didn't get in the food that we ate. And the notion that we're eating synthetic supplements or those that are out there, to help augment what we ate, that doesn't make sense either. So you've got-

Dan Kurzrock: It's also just way more fun, right, to eat delicious food.

Dan Lohman: Yes.

Dan Kurzrock: Gives you the nutrition that you need.

Dan Lohman: And it's a lot less expensive, you don't have to pay for expensive pee. Excuse me, but you know what I'm talking about.

Dan Kurzrock: Right.

Dan Lohman: So anyhow, as far as creating this product and being able to sell it, who do you sell it to besides yourself, in terms of an ingredient? Who else buys this? Why would they buy it? Et cetera.

Dan Kurzrock: Yeah, so some of the stuff is under, it'll be released later this year. I can't disclose the names of some of these companies, but we're working with large CPGs as well as foodservice companies, which include restaurants. Some examples of local products that are coming, we're in Northern California, we're working with various sizes, at least, not just like multi-national CPGs. We've got a fresh pasta in Northern California that are hitting the shelves right now. It's a really nice spaghetti, a ReGrained spaghetti. We've got a market, Whole Foods. There is North Bay Pretzel, they're doing a Bavarian-style pretzel using our ingredient. There's a local bakery that does a really nice bread with it.

There's a wide range of applications. Bakery and snack is kind of the lowest hanging fruit if you will, and we've got a few really exciting projects going that are going to have a much more meaningful scale, if you will, around using this. It's very versatile. And we even have people that are working with it to make sauces, for example, replacing modified cornstarch. It's got some of the functional properties that modified cornstarch does to thicken a sauce, but is actually bringing more nutrition and also more flavor.

People who like that whole-grain taste, especially rye flours and things like that, it's on that spectrum in terms of sensory, what it does to something. It's really aromatic. It's kind of got a nice toasted, roasted, nutty flavor that it imparts that we try to showcase. Our bars don't showcase it very well. The reason why we're making nutrition bars and putting those on the market is that when we were in college, making loaves of bread, we wanted to come up with something that we could make more of that would have a longer shelf life. And we could make 100 bars in a home kitchen on sheet pans, cut them by hand, package them by hand, and we'd have inventory. And that just became our revenue-generating marketing for the concepts, and we're still making bars. And we're in Whole Foods and places like that with the bar, and it's a great product, but what it's not great at, is showcasing the flavor, the grain.

And then our puffs that are coming out do a much better job of that. And we're really excited because we start understanding more what this ingredient can do. Whether it's a pizza crust that they're getting at their favorite pizza joint in town, or if they're walking down the grocery store and they're buying cereal, or chips, or cookies, knowing that anything that's made with ReGrained is going to taste great, and also be nutritionally superior to the alternatives on the shelf.

Dan Lohman: So you're talking about-

Dan Kurzrock: And-

Dan Lohman: Go ahead, I'm sorry. What?

Dan Kurzrock: Should be a footnote, I guess. And make a difference through.

Dan Lohman: Well, I think that's so critically important. The origin of your story is fantastic. The fact that you are doing something to make a difference. When you're talking about the flavors, that what you were talking about in terms of showcasing the flavor, the nutty, the roasty, et cetera?

Dan Kurzrock: Yeah, so that's what one of the really exciting things about this... A lot of times when you have an ingredient, it can be really nutritious or it can be really functional, when I say functional, I mean from a product development standpoint, like a binder, extenders, different things like that. Sometimes those products have challenges with flavor. They don't taste great.

Our ingredient is ReGrained. We call it SuperGrain Plus. So ReGrained, SuperGrain Plus. Plus is because it's not just a super grain, it's also better for the planet, and all this good stuff. It's subtle enough wherein a recipe that you just want to showcase, it doesn't overpower whatever you're making, so it can be something that's just kind of a nice backbone to the flavor profile. Or it can be, for example, like a really nice hearth bread or a pasta, where you really want to showcase the flavor profile, that can be done. That can be done too, so it's versatile in that respect. And that's something that product developers and chefs really like about working with our ingredient.

Dan Lohman: Well, that's exciting.

Dan Kurzrock: And we would have never known. We just were like, "Hey, there's a lot of this stuff. Let try and do something with it."

Dan Lohman: Actually, that was going to be my next question, is what can you do with it? How do you use it, et cetera? So am I getting ahead of myself by thinking that this could be a food source or a solution to the problem of homelessness and malnutrition around the world? Or is that way far down the road?

Dan Kurzrock: Maybe it could be a part of the solution. What I really caution people against, is conflating food waste and hunger, like there's a lot of factors that go into what... It's true, there's a large number of people that are food insecure, and I think the model for upcycling could be something that's used around the world to create new, affordable food supplies. But it's not going to be the solution for that, but to the extent that we can support fighting waste, or putting things to best use as a way of feeding hungry people, is something we're very interested in, especially internationally.

Beer is brewed all around the world. Other beverages also have nutritious byproducts, and other products have things that are currently byproducts that we can put through our process to develop new ingredients out of, and ultimately create a more circular food system. So that's kind of what we're focused on first, is closing these loops and building a market for it, and helping food companies, and product developers and such understand what they can make, and how they might think about marketing it, things like that. And as we kind of progress forward through the phases of our growth, that's definitely something we're thinking about, but we're also careful not to try to claim that we're doing that today.

Dan Lohman: Well, I was thinking more in terms of aspiration, and what made me think of that, Daniel, is that you've got those peanut butter dense type products that people are using to feed and nourish people around the world. Well, here's another protein-rich, fiber-rich product, depending on how long its shelf life, or whatever, whole other conversation perhaps, but it just seems like it might be a nice fit to kind of help augment what people are doing.

And where I was going with that, exactly what you mentioned, is food deserts. There are so many food deserts in this country, and it would be great to have a product like this, maybe even as a cereal, which by the way, I think it would be cool if you guys came out with a cereal, because that would allow flavors to come out. But then also then, you'd have something that'd be shelf-stable that might be able to help going to those different markets. Like a hot cereal or something, you add water. I don't know. But-

Dan Kurzrock: Yeah, even a standard cereal could be a great application. Our puffs are basically the process of making cereal. We're just applying a savory seasoning to it and putting it in bags to snack on like a chip. But it makes a really nice cereal and that's something that we want to... We prefer to, anyone who's listening who runs food companies, we're always looking for partners to develop these, we want to work together on bringing these things to market. And cereal's a great application, and any organization also that are working to address food deserts or hunger, we want to hear from you. We've got some ideas about how we might play a role in supporting that and we're just really keen on collaboration.

Dan Lohman: Love that. In fact, I've actually got a couple of companies I was thinking of right off top of my head that I think might be a good candidate for something that you're doing, so we'll talk about that in a bit. So do you want to be an ingredient supplier or do you want to be a branded product, or you want to be both? Or what do you want to be when you grow up?

Dan Kurzrock: Yeah, it's a little bit of both. The ultimate vision is to be mostly an ingredient company, so most of our revenue coming from the sales of ingredient, but we're branded ingredient. We're not selling commodity flour, for example. We don't want to be selling commodity flour. Maybe way down the line, when there's more of a market developed, that's something that'll make sense.

So yeah, I would say within a few years, most of our business will be focused on the ingredient. The thing with our own brand is it allows us to test not only product applications and product-market fit with that, but also messaging and build recall for this idea. The reality too is that we can get to market with a new product very quickly, whereas some of these larger food companies have established processes that can take 18 months, a few years to get something from concept to shelf. And so it gives us a way also to commercialize things in the shorter term instead of having a guess-a-thon about what's going to work. We can actually test it by doing it.

Dan Lohman: So on that note, messaging, what are you doing about that? How do you get the message out? How robust is your social media? Or how robust is your messaging beyond the brand itself? Beyond the packaging? Beyond the bar?

Dan Kurzrock: Yeah, something we care a lot about, there's always room for improvement. We're very vocal as thought leaders around the food waste movement and we're some of the first people to talk about upcycling the food. We actually have the term edible upcycling trademarked. We think it's a good way of conveying what it is, but we mainly teach people what upcycling means, right, too. And so it's kind of off path, we write articles. I do a lot of speaking, and interviews, and things like that to talk about what we're doing.

Social media's very big for us. Another thing we try to think about, I don't remember who it was that said it for the first time, it was this idea of operation as marketing. So I think to have really authentic marketing, it starts with having authentic operations. So, being very transparent about our practices and getting things like B Corp Certification, things like that, because we believe that while every single person might not care about every single thing that we're doing, there is a group of people that cares about every individual thing that we are doing. We bring intention to every decision that we make and typically we broadcast it. For those that want that answer, we try to anticipate what their questions are going to be about and try to show that we're not...

A good example would be packaging, which is a whole can of worms I'm happy to get into. The short of it is we decided really early on, that we weren't going to fight food waste and create packaging waste. So we were first to market with a compostable, flexible film wrapper for the bars and it's something we're really proud about. We talked about a lot and we ended up finding out that a lot of our products were going stale before they hit the shelf, because they're in a hot truck, and the moisture barrier on the film that we were using wasn't sufficient.

And we made a really hard call to switch to conventional film, to what everyone else is using to protect the solvency of our business, and kind of slow down to speed up and make sure that we can not create food waste in our efforts to fight packaging waste. And we were very transparent about that, very vulnerable about that, it was a really hard thing for us to do, but it's just how we do business. We're here to do this authentically or not do it at all. I think that's all, I kind of got a little rambling from your question there.

Dan Lohman: No, no, that's fine.

Dan Kurzrock: Hopefully that shows how we're thinking about it. It's not just about coming up with a strategy and executing that strategy. It's really about looking at every level of our operation, making intentional decisions, and then broadcasting those.

Dan Lohman: I'm glad that you got a little bit philosophical, my words. That's what I love about natural brands. So what I do, as a side note, is I help you leverage that story at retail. And so what I'm getting at as a founder, as a business owner, you would understand that the objective traditionally, is that you go raise money and then you spend a lot of money getting your product on the shelf. It's pay to play. It's really expensive.

The reality is, as you mentioned, rightly so, there are a lot of people that will go out of their way to buy your product at a premium because of that authenticity that you have, because of that transparency. And to me, that's far more important and any savvy retailer listening needs to understand that if they want to remain relevant, they need to cater to that new type of consumer that has the ability to go to Amazon, or Whole Foods, or Jet, or wherever, to buy their products. And if they want to remain relevant, then it's a lot cheaper to keep that customer, me, coming back into their store because they support the things that matter to me. They're community-based. So in talking to that, I think that's really relevant and really important.

By the way, as you know, the reason that we met is that I had the privilege of listening to you talk at the Climate Collaborative Summit at Expo West. You were talking about packaging and packaging waste.

Dan Kurzrock: Yeah. That's right.

Dan Lohman: I was inspired by that. That was really cool. So where are you in that journey right now in terms of packaging?

Dan Kurzrock: So we've got a few new films. We participate in this group called OSC Squared, it's One Step Closer to an organic and sustainable future, full name the organization is, and there's a packaging collaborative in it that we're one of the leading members. We describe ourselves as the guinea pig because we commercialize some structures that really hadn't been fully tested, because we, better or worse, decided that the most important thing is that we authentically pursue our values rather than come up with reasons to wait to follow someone else's lead on it. We wanted to walk the talk. We don't really know how to do anything else.

Part of the reason that we rebranded, I don't know if you've seen the rebrand out there. It helps to set up to deal with the transition back. One of the key things we had to do is remove the window from the product. And we've got some new structures, film, these wrappers basically. We've done the trials at the contract manufacturer. Now we're awaiting the shelf life studies, and we're going to do some mixed stream temperature studies. We found when this was in a hot environment, that's when our product was going stale the most. So we're actually going to put them through distribution and ultimately, we have to actually get it through the type of rigors that a shelf-stable product goes through to ultimately get to the shelf.

It's still going to be a number of months, maybe a year, before we switch back to a compostable structure. I hope sooner. As soon as there's another proven structure that's out there, we're not proprietary about this, we think this is something that everybody should be at a minimum, pre-competitive, if not non-competitive about. Our industry is in the future trash business. CPG, consumer packaged goods. It is the packaging that equals future trash, and that's something that can't continue. It's not okay. We're hoping that the structures that we're testing work and then we can kind of open-source that knowledge and bring more people into the tent of caring and making the right choice, because if it's just a few extra cents a package, that's something that should be built into the cost of doing this business.

So for us, it was never about... But it needs to work. The package needs to keep the product fresh, and unfortunately, conventional plastics, even though they're fossil fuel derived and landfill-bound, they're not only cheap and abundant, but they do a really good job of keeping a product fresh. And these new structures that we're testing are really exciting and have a lot of promise, and we look forward to having more updates on how they perform through these various tests. That line that I said earlier, slow down to speed up, we're still in that pattern of the slowing down and making sure that we're doing it right, because sure, if we fail again, maybe it'll hinder business or something like that, but more importantly, we don't want to be scaring people away from trying these new films. We want to be proving that they can work. You think about the fact that it's actually only been not too many decades that plastic has been around as a thing.

Dan Lohman: Mm-hmm (affirmative).

Dan Kurzrock: I mean it's like 60 or 70 years that plastic has been around, and in that amount of time, we've managed to... I mean there's more plastic in the ocean than fish pretty soon.

Dan Lohman: Scary thought.

Dan Kurzrock: Scary thought, right? And so, let's do something about it. Another thing about packaging, by the way, since I have a little soapbox going here-

Dan Lohman: No, go ahead.

Dan Kurzrock: Another thing that I think needs to get talked about more is upstream. So when we talked about plastic, we often talk about downstream. By that I mean, is it going to landfill? Recyclable? Is it compostable? But upstream, I mean supply chain, conventional plastic is petroleum products. And these compostable plastics are plant-derived and they can be regenerative in how they're produced, and what the feedstocks going into them are. And a lot of people get really caught up, understandably so, in the downstream because composting infrastructure is lacking.

People that do compost food scraps, only a portion of those actually accept compostable plastics. Only a portion of those actually ends up composting the plastics. There needs to be more infrastructure developed, there needs to be some... There's a lot that needs to happen downstream, and as food manufacturers, we can play a role in that, and we should be very active in helping advocate for directly supporting the development of infrastructure. I like to boil things down to what we can do directly. What we can make decisions about that actually make an impact, and we decide what we source upstream, right? And so, at minimum, even if things are still messy with composting down the line, we can reduce our reliance on fossil fuels and use plant-based influx. And I really want to start seeing more people talking and thinking about the whole value chain and not just the downstream.

Dan Lohman: I appreciate your going there and I'm so thrilled that you did because actually, I was going to ask that question anyhow. So in the event that you were speaking at, again what brought us together, I asked the question, "Well, since of a lot of the product that is compostable gets put into a waste system that doesn't understand the difference and it gets thrown in the landfill anyhow, then why are we trying to fix that? Or why we waiting until some municipality does something or whatever? Why don't we take this and then handle it?" Where I going with that, Daniel is this, I am a huge advocate for what you're talking about. I've had several of the leaders, the thought leaders, I'd say two, from the Climate Collaborative, on the podcast who's talked about this exactly.

In addition to that, I have two free mini-courses that I did in cooperation with Kelly Williams about this exact topic. The point is that you're right. We got to get this fixed and we got to do it now, and we need to stop making excuses and waiting, in my opinion, for somebody else to do something that accommodates something, whatever. Let's figure out how to do this.

So earth digestible print-on-demand packaging is something I'm really interested in. Actually just put out a YouTube video about it, which is really cool, but also, that's the crux of those two mini-courses that I put together in collaboration with Kelly Williams. NatureFlex. As you go through this study, and you work on this and you start getting inputs and understanding what's going on, I would love to revisit this topic with you, and know exactly how it's working.

So from a layperson, this makes all the sense in the world that I could throw it away in my backyard, literally, and have it compost and get it digested. I've actually got, actually on the YouTube video, they've got a video of the product actually being dissolved over the course of time, maybe you've probably seen it. It's really cool. So everyone's got to check it out. Because it's neat the way, you can see it on the side of the film, it's somewhat opaque, and within a couple of months, it's virtually gone.

Dan Kurzrock: Right.

Dan Lohman: So I mean, that where we're going. And to your point about ocean waste and everything, and so this is a huge focus of mine. I love the fact that you guys are taking a leadership role in that. I've seen some of your articles. Again I listened to that talk and a few other talks. What other things do you have that you want to share? By the way, I think that to your point, every brand needs to take a leadership role in this.

We need to stop kowtowing to the way big companies are doing things. The reality is that if P&G, Frito, Pepsi, doesn't matter who it is, were to adopt this technology, the problem would be solved tomorrow, pretty much. But because it's these smaller, disruptive brands that are taking a leadership role in fixing this problem, how do you recommend other brands get on board? How do you recommend someone like me that are trying to help educate people about that, broaden that message?

Dan Kurzrock: Yeah, I have a few comments on that. One, with respect to the big guys, some of them are actually doing some really good work. I'd love to better understand when some of their technologies will be available, but Pepsi, you know, Frito-Lay, for example, they've been doing a lot of work on this structure called PHA. That's a really cool one. It's actually a company here in the Bay Area called Full Circle Bioplastics. They can actually make it from inedible food waste and it's ocean degradable. It's kind of like the holy grail for flexible foam packaging. It's not commercialized yet, but it's been in development for a long time.

What's frustrating is just how slowly things are going and until recently, how little, I feel, most companies were willing to talk about the fact that they're generating so much trash today, and what they're trying to do to solve it. I don't want people doing this in spite of us. I think we need to be working together on it.

Dan Lohman: Yes.

Dan Kurzrock: So for the younger brands, brands of any size, honestly, there's OSC Squared, get involved with understanding what's available today. At least test your products in it and see if it works for your product, and start thinking about the economics of how you might make that switch. I hope we get to a point pretty soon where the consumers will ultimately punish brands that aren't taking a leadership position on packaging, that isn't doing something about it. It doesn't make any sense to just do this in silos and have a bunch of redundancy of work and a bunch of people waiting and watching. And if anyone listening decides this is for them, no matter where they are, and actually in one of the articles talk about kind of a call to action for different, whether you're a food manufacturer, or a brand, or a retailer, we need to talk about this more. Waste hauler, right?

So for the brands, it's about testing the latest structures and seeing if they work for their products. For distributors, great thing a distributor could do right now, helps us test the distribution piece of it and, even just a pallet in a truck loaded with products that are in compostable packaging that they'll drive across the country or something and then back, and we can test and we can see what they're doing to the product. For the retailer, there's a lot of opportunities to educate consumers in-store about which products are made using sustainable packaging and which aren't. Most people don't have compost in their home and most municipalities don't either, so maybe there's a model for collection of these materials, a more centralized industrial composting facilities can collect them from.

I think there's just a lot that everyone in the system can be doing and we're all getting pretty good at admitting there's a problem finally. But I want to see more people, I guess, taking direct action, even taking some risks, in trying to figure out the solution as we did, and it was a big challenge for the business. And it remains one, we have customers that had a bad experience with our product. We don't know who they are or if they'll try us again because we didn't know it, but our product on the shelf was stale, even though it was within the date code, because our product dried out, basically.

And that was a hard thing for us to get through. It could have easily destroyed the business, but I don't regret it. We had to try it. We had to take action on our ideas. What's the point of being in business if not for that, as we see it? We think that brands will be ultimately rewarded for that leadership position, and for us, it's not about intellectual property or anything like that as it relates to packaging. It's about doing the right thing. More importantly, doing something.

Dan Lohman: Exactly.

Dan Kurzrock: You know, not to accept the status quo and rejecting that appeal to the tradition of, "Oh, well, things are the way that they are because that's the way they've always been." Right? Let's move past that and create the future we want. And one thing that I've said in interviews before, I probably ripped off the quote from someone, I really don't know who to attribute to, but it's like we put a man on the moon, right? We can probably figure out packaging.

Dan Lohman: You would think, yeah. And to your point, Kelly and I got together because again, this is a really important topic to me. And so we created a free mini-course and it was all about education. And then we listened to you talk at Expo West, and we listened to the other guy, I'm sorry I don't remember his name, talk about the technology that you mentioned a minute ago about turning food waste into packaging, and a couple of other people. And we got together right after you guys left the room and decided that, "Hey, we need to do more." So that's why the second free courses. And the point is that we talk about exactly what you just shared.

Kelly brings up the point that if you put Oreos in a truck on a pallet, and they rub together for a couple of thousand miles, will that still look edible? Will you still want to eat it? And then what does that mean and why is that important in how consumers buy products and so on and so forth. And then where I come in, is helping you leverage strategies so that instead of being a commodity to the retailer, to the consumer, to the whoever, you're leveraging the fact that, as you said, it costs a few cents more to put your product into sustainable, recyclable package, et cetera. And then you shouldn't be penalized for it. That should be part of your branding as your selling message as opposed to something that we're going to penalize you for. And to your point, I agree with you 100%.

The brands that aren't adopting these strategies aren't thinking forward, aren't thinking about what their consumers want. They should be penalized. I mean that's what a free market system is, and long story short, you've got a serious, significant, competitive disadvantage because you're small. And I want to change that. So thank you for sharing that. We've talked a lot about several different things in terms of the packaging, the ReGrained, et cetera. What have we not talked about that you want to cover, that you want to share?

Dan Kurzrock: We have covered a lot of ground.

Dan Lohman: We can go for a couple of hours.

Dan Kurzrock: No, I just want more walking the talk as it relates to taking some of these sustainability initiatives to the next step. Things like upcycling are exciting. There's a lot there, but it's not... There's regenerative AG. There's just a lot of impacts that our food system can make, either positive or negative, and today it can be very negative. If you just look at food waste specifically, 40% of all food that's grown is wasted, which is a shocking number, right? It's not a new problem either, there's some, I guess propaganda would be the term for it, from World War II, around fighting food waste as a national initiative. It was important then, and then it didn't get talked about for a while because we had this abundance, I guess.

And now we're in this world where basically it's like leaving a grocery store with five grocery bags and dropping two in the parking lot. That represents 20% of all freshwater, some of the greatest contributors to greenhouse gases, and things like that. And for me, it's always been shocking and terrible, but one of the things that we like to talk a lot about is how this actually overlooks a big piece of it as well, which is, what is food waste? For example, 40% of food that is grown is wasted.

That doesn't include edible, nutritious byproducts that could be going to best use. Like brewers' grain that may be going to animal feed or to compost isn't measured as a part of the food waste numbers. Even just that supply chain from breweries in the U.S. alone is about 20 billion pounds. We can make enough loaves of bread for every American to have 34 loaves of bread or 14 thousand cookies from that amount of flour that we can make from that much grain.

Dan Lohman: Sign me up.

Dan Kurzrock: A year.

Dan Lohman: Sign me up.

Dan Kurzrock: Right? So we really think upcycling, it's a new term for a pretty old idea. We know it makes both dollars and sense, to be a little punny. And it's something that we would love to speak with anyone about helping them participate in that. Not as the only way that anyone can make a positive impact, but just one. One way that can start the conversation too much more. So yeah, I think we've covered a lot of ground. It's important to me always to convey also that ReGrained is not just a consumer packaged goods company, let alone not just a bar company. We'll work with other bar companies. We will work with other packaged food companies. We want to help develop a more sustainable food system. And that's why we're here. So, yeah, I don't know. I could ramble on for a while, but I guess that's what came to mind when you prompted me with that open-ended question.

Dan Lohman: Well, I appreciate your sharing that. Again, that's why this podcast exists. That why I've been wanting to have you on the podcast. The focus here on this podcast is about these technologies, about leveraging, about helping to change the world one consumer at a time, one brand at a time, et cetera. For example, a couple of weeks, actually a couple of months ago, at this point, a month or two ago, Walter Robb and I were talking about food waste. As a former grocery manager, I remember throwing staggering amounts of food away. We've talked about regenerative agriculture.

We've talked about packaging. We've talked about all sorts of things on this podcast. More importantly, how do you leverage those strategies to grow sales on shelf. How do you not just be an ATM machine to the retailer, but take what you're doing and then go to the retailer and say, "Here's how I can help you grow sales by levering the strength of the consumer or the community around my brand." So thank you for sharing that. How do we get ahold of you? How do we learn more about ReGrained, the brand and the ingredient, and anything else you want to share?

Dan Kurzrock: Yeah, absolutely. So our website's just regrained.com. My email is just Dan@regrained.com. I'm pretty easy to find. LinkedIn is also a good way to get in touch. Our products today are in places like Whole Foods, of course, online, on Amazon, and our website. We're always looking for new retail partners. We're not trying to go huge right away. We want to really grow sustainably. But the most important thing, from the ingredient side, to CPG company or food service company that's interested in understanding what ReGrained can unlock for your products, that's what's really exciting for us is doing this together and building something better together. So maybe leave it there and we'd love to continue the conversation, as you can hopefully gather, potentially to a fault, although I don't think so, we're extremely transparent about what we're doing, how we think about it, where we want to go, what the challenges are, and things like that. That's what you get with us, and hopefully, that's something that's appreciative and can play a role in something meaningful.

Dan Lohman: I think that's great. I think it's so meaningful. Thank you for sharing that. I don't think you should ever have to apologize for it, by the way. And I know that's sort of the way that the world is that "Look, we're trying to do something different, or new, or whatever." The reality is you're making a difference and I celebrate that loudly. Celebrate you for doing that, and I would encourage people to come in and support you through buying your products, through learning more about what you're doing, by championing you. Long story short, by helping you do more good, you're helping us as a community, as an industry, as a society, to do better. So thank you again for all your efforts. Thank you again for making time for me today and I look forward to our next conversation.

Dan Kurzrock: Yeah, likewise. Thank you so much, Daniel.

Dan Lohman: Thanks. I want to thank Daniel for coming on today, for sharing his story. What an inspirational story. Coming up with a unique and creative process that other people overlooked. I love the transparency and authenticity in his message. Not only in his message, but in what they're doing. Their commitment to addressing the issues around packaging, around climate change, around package waste, around food waste, et cetera. My hat's off to them. We need more thought leaders in this industry that are willing to step up and do more to help more brands succeed. That's what this podcast is about. Featuring and helping to amplify the story of thought leaders like Daniel. There's a link to ReGrained in the podcast show notes and on the podcast webpage.

Today's free downloadable guide, The Essential New Item Checklist, The Recipe for Success. This is the foundation that every brand needs to be built on. If you don't have a healthy foundation to build your brand on, well, it costs a lot more money to fix the things you didn't do right, to begin with. The challenge is these are the things that literally every brand overlooks. And if you can do this well, it's going to give you a significant and sustainable competitive advantage as you grow. You can get this free downloadable guide on the podcast show notes and on the podcast webpage. And you can get there by going to brandsecretsandstrategies.com/session148. Thanks for listening and I'll look forward to seeing you in the next episode.

ReGrained www.regrained.com

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