BRAND SECRETS AND STRATEGIES

PODCAST #91

Hello and thank you for joining us today. This is the Brand Secrets and Strategies Podcast #91

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: Welcome. This week's story's about a tenacious entrepreneur that would not give up no matter the problem, no matter how many bottlenecks were put in front of him. He followed his gut and he did the research to ensure that he had the right strategy to move forward. More importantly, he redefined the category in terms of the way we think about something that most of us think of as a commodity. As a result, carved out a unique niche that set him apart from the competition, something that really was a game changer in the way that consumers think about nut butters. All of a sudden, they were a convenient snack, a quick energy boost for athletes and people on-the-go. The convenient and easy way to try new products and a convenient portable source of protein. In the process, Justin has become instrumental in changing the way that big brands focus on what's important to the consumers, by what he calls the triple bottom line approach, that focus on people, products, and planet. This is changing the mindset, and the way that big brands look at small brands by focusing on the consumer and helping small brands gain a bigger voice and help them get under more retailer shelves and into the hands of more shoppers.

I hope you're enjoying this podcast. Please, share it with a friend, subscribe, and leave a review. Don't forget, that I try to include at least one free downloadable guide at the end of most every podcast episode. This, in addition to my courses, gives you one easy to digest strategy that you can instantly adopt and make your own. One that you can use to grow sustainable sales and compete more effectively. Remember, the goal here is to get your product on more retailer shelves and into the hands of more shoppers. Here's Justin.

Justin, thank you for making time for me today. Could you start by telling us a little bit about yourself and your journey to Justin's. I've been reading a little bit about your bio and your story and it's fascinating. Could you share it in your words?

Justin: Yeah, of course. It was ... I think it's safe to say that most entrepreneurs don't plan on becoming business people or entrepreneurs. They kind of just become frustrated with something that's occurring in their life and it's something that nobody's addressing. Rather than sit idle and let it continue to bother them, they decide to kind of fix the problem, find a solution. Hopefully, enough people can identify with that challenge that it might become a business, and that's exactly what happened to me. I grew up in Western Pennsylvania. I went to a small college in Central Pennsylvania and there I was studying environmental law. I was really excited about and passionate about learning about protecting our natural environment through legislature and other avenues. So, I was preparing for the LSATs and I was interning at a non-profit environmental law firm. My senior year during the internship, I just became disillusioned with ... I don't know, the excitement and the energy and the passion of being a lawyer and it mostly had to do with the energy level in the office. Most of the people I worked with were not happy being lawyers, and I thought it was really important for me to have a profession that I'm not only am passionate about, but I love to do. So, I dropped out of the LSAT course and I graduated a degree in environmental policy.

My whole life was in Pennsylvania and I went there for financial aid and state tuition, all that. So, I tried to move as far away from PA as I could, and I ended up in San Francisco for about a year, and realized that I'm not much of a city person. Then, out of really ... I wanna say deliberate happenstance, I ended up in Boulder. Primarily because I wanted to find a university town where I could get residency, go back to school about something I'd become passionate about, hopefully would figure it out. Boulder just connected a lot of the dots for me, 'cause it was a university town close to the mountains and it was a very liberal setting, I had heard, and I had a buddy who had went to CU and really loved this community. So, I ended up in Boulder, and I was waiting tables, and I was working at a few restaurants.

Being a vegetarian, I was eating a lot of peanut butter and almond butter really just for protein. I'm eating a lot of nut butters and right away I became really curious, right? This is 17 years ago, and I'm really curious, and I'm like, "Interesting." I'm like, "Why is it that peanut butter only comes in two flavors? Smooth and crunchy. Then, there's this whole section right next of it of all these different jams and jellies and preserves, but peanut butter is just really boring. Why is it that when I eat a handful of almonds it tastes amazing, but when I buy this brand of almond butter on the shelf it doesn't taste very good?"

So, I was just curious, and I probably had too much free time on my hands. So, I got a food processor, and I just started making my own nut butter concoctions just for fun, had no idea starting a business. I would take peanuts and I would make peanut butter and I would add fresh banana, and then dried banana, and then freeze dried banana, and then maple syrup, and then honey, and then cashews with some raisins or dried blueberries, and just kind of have some fun and figure it out. Then, before long I had all these empty jars of all these different flavors all over the house and in the fridge, and my roommates would always steal them and eat them all. Then, for me, this was just kind of an experiment. So, I'd just start writing my name of the jar, 'Justin's', to kind of protect these concoctions, 'cause I kinda wanted to see what happened overtime with them, kinda like experiment. Then, one of my roommates just really encouraged me, you know? They were all like, "Yeah, these are really good. Have you ever thought about selling these?"

I didn't know anything about food production or starting a business, but I did have a lot of confidence with using a library. So, at that point I went to CU's business school's library and I literally just sat down and started researching how to write a business plan, 'cause I'd heard from a lot of friends that a business plan is basically the foundation, the tool, for what you use to start a business. So, I'm writing this business plan, and then I'm literally stumped on the first section of the business plan, right? What type of business entity do you want to be? An LLC, a sole-proprietorship, a partnership, an S corp, a C corp, I didn't know the difference between any of them. Between you and me, I didn't really care, I just wanted to get going. Clearly, there's some deep tax consequences and whatnot, so I had to know, 'cause I really couldn't get past the first section.

So, then you have to ask yourself, "Gosh, I wonder if they're any national food companies in Boulder? I'll just pick their brain and see what they did." As you already know, this is when my brain exploded. I realized that companies like Celestial Seasonings and WhiteWave, the makers of Silk and Horizon Organic Dairy, Rudi's Organic Bread, Izze Soda, and Wild Oats at the time, were all these companies ... Boulder Chips ... that were all here in Boulder and the people who worked in these organizations were not only easy to find, but they were really willing to help, and really nice people, and they really wanted to see the entrepreneur succeed in areas where they'd done really well. So, I wrote my business plan, I raised about $40,000 dollars from friends and family, and then I found a commercial kitchen in South Denver. It was really hard to find a kitchen space, but I found someone that was making salsa. On night and weekends when they weren't making salsa, I negotiated that I would make nut butter there, because they would never even know I was there, why not rent me a space on off hours? So, I'm having peanuts, dry roasted, FedExed to my house, and I'm driving them to Denver, and I'm picking up jars at a warehouse along the way, and labels that I had printed that I had left there.

I just start making these nut butters and I was able to sell them into a few stores locally and also was able to debut at the farmers market. So, I was selling here locally, I'm at the farmers market. At that point, I wasn't able to get into any large grocery stores, because I guess I wasn't ready or I didn't have all my ducks in a row, so I really didn't even focus on grocery. It was really about figuring out how to navigate the food system. So, for about two or three years, I just sold locally to specialty gourmet shops, to sandwich shops, to bread stores, to all these little places. Then, slowly I started to figure out grocery. I'll never forget, Boulder Co-op was one of my first accounts, then Lucky's over in North Boulder brought me in. Then, I got a break with Whole Foods.

Whole Foods was really hard, because I'll never forget, I walked into Whole Foods and there's David Spicer, the grocery buyer at the time and this is 15 years ago. David's stocking the shelves, and I'm like, "Hey, David! Hey, excuse me, sir. Do you have a second?" The guy's like, "Yeah, yeah. I got a few, how can I help you?" I'm like, "Hey, my name's Justin, and I started my own peanut butter company and I'm making almond butters, too," and then, all of a sudden this guy rolls his eyes, and he's like, "Oh, here we go. Another person who started their own company, this is gonna be interesting." I'm like, "I was really wondering, how can I sell to Whole Foods? To you, to your store?" He was like, "Well, you gotta go and fill out all this new item paperwork and then you gotta ... We get everything through a distributor, so you gotta go through UNFI." I was like, "All right, sounds great. Thank you so much. I'll fill out the paperwork, and I'll submit it, and I'll contact UNFI."

So, I contacted this distributor, and I'm like, "Hi guys," I call 'em up, "My name's Justin. I have this nut butter company in Boulder and I want you guys to deliver to Whole Foods for me." They're like, "Oh, yeah. That sounds great. It's interesting, Whole Foods didn't alert us about you or anything like that, how many stores are you gonna be authorized for?" I'm like, "Just one store. Just the Pearl Street store in Boulder." They're like, "Yeah. Well, listen kid, that's not how it works, right? We can't just deliver to one store. We're in a business of distributing things, so if you get into the whole region we can have a conversation, but until then, good luck."

So, I go back to David a few days later, and I'm like, "Look, man. What am I supposed to do? These guys won't deliver for me, can I do it myself?" David's like, "Ah, man, it's tough because I use this scanning gun, and I just scan things, and they come in the next day. I gotta find your products, and I gotta call you, and ask you to come in, and I just don't have time to do that for everyone." I'm like, "All right, all right. Well, what if I come in and I find out exactly what you need and then I'll deliver it myself, just what you need?" ... "Yeah, yeah. That's fine, but then the problem is all your products are gonna be in the warehouse and I won't be able to find them. It really bogs down our system." I'm like, "All right, all right, all right. What if I come in, see what you need, deliver just what you need myself in the back, then I'll take it from the back and I'll stock my own shelves?"

Dan: Love that.

Justin: "Ah, I hear ya, but what happens if it doesn't sell? My job is to make money for our category." I'm like, "All right, all right, all right. How 'bout if I'll see what you need, I'll deliver it myself, I'll stock my own shelves, and I'll stick around and do demos? If no one buys a thing, take it home. Give it to your family, give it to the team, and I'll give you your first case for free, and that way you don't lose any money." Finally, he was like, "Fine. All right, go away."

Dan: I love it.

Justin: So, the entrepreneur way is to just turn every objection into an opportunity. Then, I got the jars in, and I was struggling with the jars. We were expensive, and we weren't differentiated enough, I bought three skews. Then, my big 'aha' moment was ... I was on a mountain bike ride and I'm like three, four years in now. I'm on a mountain bike ride and I'm eating an energy gel. I'm like, "Wow, these energy gels are great, but I'm not craving sugar right now. I really want protein. Why isn't anybody putting protein into a squeeze pack, like peanut butter or almond butter? That's an interesting ..." So, then I got really excited. I'm like, "No one's ever done that before." Then, you start getting paranoid. "Why hasn't anyone done that before? It's such a silly idea, clearly it's been done, clearly someone has done it already. Well, goodness, can it not be done?"

So, I started to do a little research and I found out that there were three contract manufacturers who did all the squeeze packs for everyone. They would do everything from honey to condiments to salad dressings to lotions and all that fun stuff. I contacted all three of them. Said, "Hey, my name's Justin. I have a company in Boulder and I was curious if you could make a squeeze pack for me." All three of them start out the same, "Yes, of course. Of course. We're the squeeze pack company, we make squeeze packs for everyone. Well, what are you making?" I'm like, "Well, I got peanut butter and almond butter and I wanna-" ... "Whoa, whoa, whoa, whoa. You can stop right there. We can't help you. Not interested." Right? You probably maybe guess kinda why?

Dan: No, was it because of the shelf stable or what?

Justin: It was about allergies, cross contamination of the peanut and nut allergy.

Dan: Makes sense, okay.

Justin: Nobody was making any squeeze packs, because they didn't wanna share a line with peanut butter or almond butter or nuts. For most entrepreneurs ... Ah, I wouldn't say that. For most people, let's say, they'd be like, "Oh, well, that makes perfect sense. Okay, I guess that's why no one's doing it, I just ... bad idea, I'll move on to something else." I started thinking, "Holy crap. If I can get my own squeeze pack machine, I'll have no competition. This could be great." At that point, it was ... I called back one of the companies, I'm like, "Look, I know you can't make it for me. Throw me a bone. What kind of equipment are you using? Where can I find it? How can I learn more about it?"

So, I started to learn about the form fill seal industry. Then, I found a piece of equipment, that was about 25 years old, that I could retrofit to make my own squeeze packs. I borrowed $75,000 from my roommates parents and I bought a squeeze pack machine, a reconditioned squeeze pack machine. I brought it into Boulder, and at this point, I used some of that money to hire a kitchen. I rented a kitchen in Boulder and I shared it alongside Beryl of Bobo's Oat Bars. Beryl and I moved in together, and we operated a kitchen together, and I made nut butter there for about five years and I learned how to make the squeeze pack there. When I first launched, it took me almost a year, let's say nine or ten months, to figure out ... you know, order the machine, get it retrofitted, get it shipped to Boulder, get it installed, figure out how to use it, get all the right things in, get the film printed, get the film in the machine, get it to fill the right size. Then, figure out what's the net weight, what do we call it, how do we merchandise it, and it took almost a year to get all of this figured out.

Then, I've got all of this money I've borrowed, and I put all of this time into it, and I'm really excited. And, I'm really paranoid, because I feel like it's such a good idea that if I don't move fast someone's gonna beat me. So, I'm moving as fast as I can and I launch the product just like an energy bar. So, I had about 24 squeeze packs in a tray. I talked to Whole Foods, and I get it set up, and I start selling it at the Pearl store. I have it in these big trays and they're sold in the energy bar section. I'm watching the energy bar set and it's not moving, no one's buying it. After a few months, the buyer there was like, "Look, Justin, this product isn't working. You might wanna come and take it off the shelf." I was devastated.

Dan: I bet.

Justin: I was like, "Oh, my God, how is this not working?" Rather than just give up on it, I started to ask a lot of questions. "Well, I think this is a great idea, why isn't it working?" All right. Well, let's study people. You know when people go shopping, they're in a rush, they're on a mission. They have a list and if you're not on the list, you're not in the cart. They get to the section, and it's a big sea of bars, and there's this squeeze pack where all their bars are. People, they ignore it, 'cause they don't know what it is, and even if they do know what it is, they don't know what to use it for. It's getting lost.

Dan: Right.

Justin: I'm like, "All right, all right. Well, what do I do? What do I do?" One of the ideas was instead of trying to make it be an energy pack, a protein pack, let's just put them in these small little boxes, 10 in a box. Let's stand them up and let's put them right next to the peanut butter and almost butter. Let's put it right next to the jar and let's just call it what it is, it's a peanut butter squeeze pack, it's an almond butter squeeze pack, nothing special about it. As soon as we did that, it was incredible. It was transformational, right?

Dan: Yeah.

Justin: People started to buy them. What was really interesting was, for me, my number one market segment was actually our third usage occasion.

Dan: Really?

Justin: Our third usage occasion was on-the-go protein. Our number two usage occasion, which I never would've thought of, was portion control. Our number one usage occasion, which I wish I'd thought of 'cause that would've been really smart if I had, was a trial size for a jar.

Dan: Really?

Justin: To someone who's seeing this expensive almond butter, who's maybe never tried it before 'cause of the price, they see a squeeze pack for a dollar, and they're like, "Oh, wow. This almond butter stuff's really good. I'm gonna buy this brand because I trust it and I know it, 'cause I just had their squeeze pack." All of a sudden, our jar sales started to increase. Unbeknownst to what we were doing at the time, we created this whole entire subcategory of nut butters. So then, a few years go by and we're growing the business. Then, I got really lucky, because around this time I found a gentleman named Lance Gentry. Lance had just kinda left Izze and was looking for his next thing, and Lance and I got along really well. Lance came on, and he was kinda like an inside mentor, and he came on to help me run the business. His guidance was incredible, he just had very strong acumen around marketing and sales and leadership, just a really authentic way of building a business and a brand. So, Lance came on and he was great to work with.

Then, I had the idea of ... Well, one of my favorite things whenever I do a demo at a Whole Foods or a grocery store, with lunch, I love to have a little bit of a ... At the end of a demo, I'll get a salad or something, but I want something sweet. Then, you go to the chocolate, the candy section, and all they had were chocolate bars, and my favorite thing in the world we peanut butter cups. I started asking myself, "Why doesn't Whole Foods have any organic peanut butter cups that taste any good? Why don't they have anything? Anything? Why don't they have organic peanut butter cups? Can you not make a really good organic peanut butter cup?" So, again I was curious. I'm like, "Well, I'm gonna go home and see if I can make one." So, I got some peanut butter and I mixed in some ingredients, I got some chocolate molds, and before I knew it I was making these amazing dark chocolate 100% organic peanut butter cups.

I'm like, "Oh, man. We gotta do this." Some of my board advisors, Peter Burns included, who's one of my favorite people in the world, was like, "Justin. Whoa, whoa, dude. Whoa, whoa. Cool your jets, man. Bad idea. We gotta focus on what we have, make this work, we'll come back and get it later. There's no category, there's no data that suggests this is a good idea." I'm like, "Yeah, I know, but my gut tells me it's a good idea, because ..." Then, they're like, "Well, think about Reese's, they're just gonna squash you. There's no way you can compete with a brand that powerful." I'm like, "Well, I'm not gonna compete with them, 'cause they're not selling in natural food stores and that's where I want the product." They're like, "All right, you're the founder, do whatever you want. We're just here to try to help you." Then, I decided to do it.

It took me about a year to find the right contract chocolate manufacturer who would not only work in small production runs, 'cause this piece of equipment want to run big runs. But, I had to find someone who would do small runs, who had the right molds and the right equipment, but also would be willing to do a 100% organic product. No one had ever done that before, so people were really skeptical or nervous or scared. Finally, found the right family that had this old single shot depositor that hadn't been used in 15 years, and they got the grandfather out of retirement to help get this thing running again. We launched our 100% organic peanut butter cup and it just took off. Before we knew it, we had this dual platform brand where we had a confection side and we had a nut butter side. Then, in the next, we were looking at other things that frustrate me. I'm like, "Oh, God. I love Nutella, but why is there so much sugar? Why can't they make one that has a lot less sugar," and boom, came out with a chocolate hazelnut butter, and just started to have fun. As we have all this momentum going, two things conspired against us which really shook me to my core. The first one was Lance Gentry, who was my hero and my inside mentor, was diagnosed with brain cancer and within eight months passes away.

Dan: That's sad.

Justin: And, leaves behind a wife and two amazing kids, who were 10 and 12 at the time. So, Lance passes away, and it rocks our entire organization, because this guy was unstoppable. Then, right after that happens, we get into a recall, our first ever recall. It makes you really understand the importance of what we do, we're making a food product. What happened was one of our peanut suppliers was also ... they're selling us roasted peanuts, but they're also making peanut butter. Some of the peanut butter that they made was prior labeled for Trader Joe's, and a bunch of people got sick, and they found out that there's salmonella in the peanut butter, and they traced it back to the plant. The FDA comes in and says, "Okay, can you show us the lot numbers for these lots?" This company goes, "We weren't keeping track."

Dan: Oh, no.

Justin: Which is crazy. The FDA goes, "Okay. Well, anything that's ever come out of this factory for the past five years, we have to recall it."

Dan: Ouch.

Justin: That includes some peanuts we were buying. So, not only, number one, did I not sleep for a month, because I was worried, could someone get sick from our products? What if someone got sick? What if someone passed away from a food product that I made, that we made, that we felt was safe and wasn't? I had this responsibility to our consumers and we let them down. So, I wasn't able to sleep. Then, people who heard about it, got really ... Some people were really thankful that we alerted them and we did all the right things and some people were really upset. They were like, "Oh, my goodness," calling us, "I have a stomach ache and I went to the hospital and I didn't feel well." ... "Okay, okay. Well, you're feeling better? Okay. Well, we're glad you're feeling better. Can you tell us what the product was?" They're like, "Well, yes. It was this almond butter and I heard about the recall," and we're like, "Well, it wasn't the almond butter, it was the peanut butter." It just got in people's heads and it was a really, really dark hard time for us. At that moment, I realized how exposed food companies are when it comes to food safety.

Dan: Yes.

Justin: From then on, I became hyper aware and hypersensitive around food safety and quality. At that point I realized, I might be in a little over my head here. So, I need to find investors, 'cause I have to help cover the cost of this recall, because this company went bankrupt after the recall, and no one could recoup any of their losses. Which cost us a few million dollars-

Dan: Ouch.

Justin: We're a small company. So, at that point, I decided, "Okay, I need some sophisticated investors, but I need some investors who can help me grow the business." So, at that point, the investors that I'd done so far, I had done friends and family, and then I did borrowed money from a roommate, and I did an investor round of local angel investors, about 50 angels. Now, I needed more than angel capital. So, I basically interviewed every private equity venture capital firm that was really specific to our space and I found the one who values aligned pretty much exactly with mine. They were a firm out of San Francisco, called BMG.

Dan: I know them.

Justin: They came in and they did an investor round. They were great at helping coach me, coach my team, add additional resources, recommend people, help fill in the blanks, fill in the holes where we had some challenges. We continued to grow the business, until we got to a point about four or five years after working together where ... we got to a point where the business had grown so fast and so far, that again, we were outgrowing all of our co-packers and the biggest challenges and risks to our business were about food safety, because as you scale the business and continue to grow it, you have to be making safe consistent food products. So, the business got to a point where, again, food safety was a concern. We were outgrowing all of our contract manufacturers, were having a lot of success with the business. Everything kinda crescendoed to one moment, it was all in the span of a month, where we're outgrowing our co-packers, our investors are starting to say, "Hey, Justin. You know, I don't know if you realized this, but one of the things that you do when you borrow money from people is you gotta pay 'em back. We're kinda hoping you'll pay us back soon."

Then, companies started to reach out to us and say, "Hey, we've noticed what you're doing. We really like what you're doing. Have you ever thought about coming and joining us and helping us grow your organization?" So, all of that kind of happened and it kinda put me in a position where I really had to ask myself, "What do I want for this company?" What was really important for me, was being able to align with ... Well, number one, pay back my investors. They took a risk on me and I own them the obligation to do the right thing by them. So, that was number one. Secondly, who can I find as an organization that'll have the capabilities to help our organization? We know a lot of food companies, and the one food company that I really liked the most had a ton of experience in making peanut butter. Food safety and food quality is what this company was famous for. They weren't famous for being a natural organic food company, but they were famous for food safety and food quality, and they wanted to learn more about how they can be stronger in sustainability and natural and organic and all that fun stuff. That company was Hormel Foods.

So, we started to have conversations with them. We worked on an arrangement where ... you know, how can we combine the best of the entrepreneurial spirit with the best of a big food system? So, how can we get food safety and food quality and financial stability to a company, but also keep the company hyper aligned around their mission vision and values and innovation and growth. So, we were able to find an opportunity to continue to grow the organization and work together. The mission, for me personally, is really to find a way of changing big food more than they change us.

Dan: Yes.

Justin: I think that the only way that our food systems, which I think are broken, have a chance to evolve and to grow ... and there's lots of different ways, right? Companies can go public, companies can grow independent, that have enough margin and investors that are patient and all that fun stuff, and velocities. Or, my company's choice is to kind of change the big food giants that are there from the inside out. The only way these big food companies are gonna change is if the natural food companies continue to grow.

Dan: Absolutely.

Justin: If they continue to grow, these big food companies are gonna say, "Okay. What we have people don't want anymore. So, we have to give them what they want," which is sustainable ingredients, organic, regenerative agriculture, all these things that are important to our natural ecosystems. And, continue to support those companies that are making those products, that are hopefully making a difference in our world. That's kind of where we are today.

Dan: Love that. I absolutely love that. Okay, let's go back, 'cause I've got several questions. Thank you for sharing all that. So, okay. What everyone's probably wondering is, did your law experience ... did your law degree, all you learned there, did that help you protect against your roommates stealing all your stuff? You'd see, "Hey, wait a minute ..."

Justin: [crosstalk 00:32:02]

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

Justin: No, no, no. It did not prepare me whatsoever.

Dan: It's like, "Here's a summons for you to appear for stealing my ..." No, that's funny. Well, I appreciate your sharing that. You shared so much great information. I've really been looking forward to getting you on the podcast and sharing your story. By the way, the last comment that you made, episode four, after Expo East last year, people were asking me why am I doing this. So, episode four, it's twelve minutes long and I made four different points. One of my points was food is broken. The way that we do things are broken. Category management is broken. My point being is that I absolutely agree with you. It's these small disruptive brands that are gonna make the difference. It's these big brands that don't understand what makes natural natural.

So, I agree with you completely and that's the main reason, honestly, that I wanted to have you on this podcast, because of all the things that you've done that align with supporting this, what makes natural natural. We'll get to that in a minute. The underlying objective with this podcast is to identify, address, and solve these important issues, so thank you for sharing that. By the way, my wife and my mother-in-law think peanut butter's a food group, so I completely understand what you're getting at in terms of the importance of this. That's hilarious. I mean, I love peanut butter. One of the things that I've noticed about you and your bio and the stuff that you shared with me, and thank you for that, I used to be, as a serious athlete, very focused on what quality and nutrition I can have to help support me. So, I used to always eat peanut butter when I went for a bike ride or ran or something like that.

So, can you talk a little bit about that transformational moment and how that really stood out? Because, if I'm hearing you, you shared a lot of struggles in the past, but all of a sudden at that point, light went on, you're in Boulder, Colorado, a lot of serious athletes in Boulder, Colorado, and you found a sustainable protein source to be able to help people, riders, athletes, et cetera, go that extra mile and compete at a higher level.

Justin: Yeah, I'd like to think I'm really smart, but I'm-

Dan: Absolutely.

Justin: Maybe slightly above average.

Dan: No.

Justin: Slightly above average. I just thought it was common sense. I just felt that as an athlete I didn't want an over processed, overly complicated energy bar and carbohydrate gel. I just figured, you know what, peanut butter is really simple, it's nutrient dense, it has everything I need and I just want to keep my diet simple. It was really just about finding simple energy. I think I got lucky. I got lucky that a lot of other people ... I resonated with them as well. I got lucky that high fatty foods were back in vogue. 20 years ago coconut oil was bad and high fatty foods were bad and people wanted fat substitutes and margarine was better than butter. Then, 10 years ago, five years ago, everything shifted and everything was 'fat is back' and 'fat is good'. It's good for your brain and it's good for your body. So, right around that shift I was out there making nut butters and people were like, "Oh, good. High fatty, high protein, high calorie foods. Gimme!" I really feel like, for me, it was common sense, and for a lot of other people, things were shifting towards that. I got lucky.

Dan: Well, I don't think it was luck, I think it was brilliant. Absolutely brilliant. I mean, I can't tell you how many times I've gone for a long bike ride and I get out a protein bar, which doesn't even look like food at all. It looks like something that you would expect to see on the space station, maybe something ... have you ever had an MRE? You know, the military food? It looked like that. Something in a squeeze pouch ... The pouches, the stuff that they gave us or the stuff that you could buy back then, squeezable sugar. That certainly wasn't the way to go. So, you get a quick energy high, and then you'd crash, and that wasn't good. I think it was absolutely brilliant for you to come up with that.

By the way, let me go back even further. I love your story, your tenacity, the way you attack this problem. One of the things that I've done in my career, and one of the things I really celebrate a lot on this podcast, are bringing in entrepreneurs like you that don't give up, that don't stop, et cetera. Then, what I'm getting at is every time you hit a roadblock, a bottleneck, or whatever, you found a way to push forward. So, not only with the squeeze packs and buying the machine and figuring out how to do this, but getting a retailer to accept your product, and just continually saying, "I'll fix this problem, I'll solve this problem, I'll solve that next problem," that they give you, until they finally give you a shot. You prove yourself. That's how your brand was born. Hats off to you for that, what a great story. So, as you're going through this process, all these different processes, Justin, what in your background caused you or made you the person that you are? Where you learn to never say no? That you had an idea and you just pushed through it, you pushed through it, and you pushed through it, and you kept creatively solving these unique problems. What makes you different? What part of you can you look to in your past that said, "This is for me"?

Justin: Wow.

Dan: Tough question.

Justin: I don't know if I've even been asked that question. That's a really, really powerful one. I don't want it to be a cop-out, but I've gotta give credit to my parents.

Dan: Sure.

Justin: My ... Let me just ... I gotta give credit to my parents. My dad was a dentist who thought like an entrepreneur, which means he was more interested in growing his practice than he was doing the dental work, than being a practicing dentistry, right? So, he would work with other dentists and he'd bring in lots of other people, he had great marketing ideas, and great business ideas to bring people in. So, I think I had a little bit of that entrepreneurial taste by watching the creativity of my dad.

Then, I think I was very fortunate to go to a small college where I got a lot of hands-on guidance and help, 'cause I wasn't the best student, I needed a lot of attention, a lot of handholding. I got a great education and it gave me the confidence really to believe that anything was possible. The one thing that I do take a lot of pride in is I'm a very curious human being and I think it's curiosity that was really helpful. In college, we did all these great field trips. We would go visit incineration plants and power plants and meat factories and waste water treatment facilities and landfills, and I got to see how everything kinda worked behind the scenes. Then, you just get frustrated with the way things are. But, I think it all comes down to seeing my parents and how they were able to solve problems, and my dad just felt that you could do anything.

Dan: I love that and that is so valuable, because that's what makes natural natural is ... And, I wanna go back to one of the things you said there. In the Boulder community, and where I'm going at what makes natural natural, like you said, there's so many people willing and able and anxious to help brands like you, to help other people like you, and then you give back a lot too. In fact, actually Robbie Vitrano said hi. He was talking to me about how you were helping him, and technically you're a competitor, but yet you're helping him solve some problems. My point being that we're all in this together. If we can help each other raise the bar and help other healthy natural organic brands, that's how we help build this industry. I'm not talking about mainstream retail or mainstream brands, I'm talking about these unique disruptive brands that are changing the way consumers buy and shop and the way that consumers eat today. So, I love the fact that you're able to share that.

One of the other things you said that I found really interesting, is that you said that you had the confidence to use the library. I love the way you put that and, where I'm going with that is, not only did you have the confidence to reach out to people and to ask questions, but you also had the tenacity to open a book and to do the research, because it's so important ... and I listen to you, and you're sharing all the things did wrong, and all the problems that you had to solve and how you got through that, the reason this podcast exists, Justin, and the reason we're talking today is because I'm trying to help brands get over the bottlenecks. So, when you're talking about your ability to use the library, what did you look at specifically and how would that translate to some of these younger brands? Whether they do the online research, they reach out to mentors, et cetera.

Justin: Yeah, I think that the terms with starting a business is people are so overcome by the creative aspect of the business that ... the most fun about it is, of course, of course it is, creating the products and thinking about the marketing aspects, from the trade name to the design to the slogans to the point of differentiation, those are all the really fun, juicy creative parts. But, what's really hard is sitting down and putting pen to paper and understanding, you know, how am I gonna grow this business, and how much money is this business gonna need, and if we grow faster than anticipated, what happens? If we grow slower than anticipated, what happens? To really be able to think through things that otherwise you may not have even thought of before.

So, what was really great about the CU business school library is they have an entire freshman section of real life business plans. Business plans that were submitted that were used to successfully start businesses. It's an encyclopedia from A to Z and has everything from donut shops to auto part centers to amusement parks to movie theaters to restaurants to canned soup companies. Basically, you find a few that either resonate with you or that are applicable to what you're doing, and you take little nuggets of information from each one, and it helps you to think through things and see through things, and understand what questions you should be asking, what things you should be looking for, what other people might ask you. Then, it gives you a chance to write all your ideas out in basically a plan. Rather than sit down and tell someone that plan and your ideas, you just hand it to them. You're like, "Hey, here's what I'm thinking about doing," boom, and they can look at it, and now they know exactly what you're talking about, and they can also give you feedback on it.

It was really important for me, in order to, A, understand what I was doing and the challenges I may face, and it was important for me to also show it to other people to get their feedback and kind of validate what I was doing. I don't think I would've been able to have been as successful without one. But again, as an entrepreneur you have to wear many hats, right?

Dan: Uh-huh.

Justin: You have to have a creative hat. You have to have an analytical hat. You have to have a social hat, where you go out and you just network and meet people. You have to have this introverted hat, where you just want to stay home and build spreadsheets all night and understand cashflow analysis, your product margin analysis. It takes a lot of different hats. Sometimes you have to really show up in the places where you're not as competent, just to figure it out and understand what's going on.

Dan: Absolutely. Well said, and I couldn't agree with you more. I work with and mentor a lot of young brands. By the way, I'm an entrepreneur residence at CU for the school of Leeds and I get to help some of the-

Justin: Right on.

Dan: Well, it's so much fun. I love working with students, MBA students, grad students, et cetera, because they have so much passion and so much enthusiasm about this. They don't have the constraints that you have, where you've gotta make ends meet, and you've gotta take care of a staff, and you've gotta make sure that you've got the right product and the warehouse to support sales two months down the road, or whatever.

Justin: Right.

Dan: So, it's kind of unique working with them in the situation where they can fail and learn. Whereas, if you fail at it, there's more risk. Where I'm going with this is that, the fact that you were or the idea that you were able to put yourself in the shoes of where do I need to be, you took responsibility like you said, you learned how to wear many hats, and learned how to understand the strategy and everything behind it, I think a lot of brands struggle with that. I think that's one of the biggest challenges in natural, and again, that's why we're doing what we're doing today, because I don't think there are a lot of great resources for natural organic brands to learn how to do some of these things. So, thank you for the inspiration.

What would you recommend to some of the young brands out there that are getting ready to start out or that are trying to understand this stuff? How would you recommend that they go forward and learn these skills? By the way as a side note, my belief is that if you're the founder, you need to keep your hand firmly on the wheel of your business, you don't hand the keys to anyone. That doesn't mean that you don't have help, you don't have mentors, you don't have people come in, and advisors, but yet, you need to be able to understand at least the broad strokes of how do you do this stuff. So, what would you recommend or what advice would you have for other brands?

Justin: Yeah, a lot of things. I think where I would start is, you know, the plan's important and all that stuff's important, but at the end of the day, you just gotta start. I think I see so many people who are so wrapped up in the analysis paralysis and the anxiety and fear of failure that they don't even start. So, I think that it's important just to get something going. I always say that if you don't start somewhere, you'll never end up anywhere.

Dan: Love it.

Justin: What I mean by that is, you may have this plan to do ... I don't know, fruit sauces. You have this great fruit sauce idea. I don't know what I'm talking about. Let's just say the great plan is to make peanut butter or almond butter, and then you find out that the peanut or almond butter isn't working as well as you'd thought. So then you pivot, and your pivot is a squeeze pack. Then, you find out that the squeeze pack really accelerates the whole business, and then you pivot again into the nut butter peanut butter cup, and you're like, "Holy Cow," that ends up being what defines the business. Then, what's our next pivot? Those pivots would have never happened had I not just started with peanut butter and almond butter, which may not have been that successful and was just by itself. You have Steve Demos from WhiteWave who started making tofu, and he did tofu for, I don't know, 15 years before he pivoted to make soy milk. He reimagined the whole entire category of soy milk with Silk, which transformed the category, but if he didn't start making tofu he'd have never had the idea to make soy milk.

So, I think a lot of entrepreneurs have to just start. If things aren't working there's two things you can do, one ... Number one, you have to be curious. Why isn't this working? It's 'cause of one of two things. One, you have the wrong product at the wrong price, and the wrong position with the wrong whatever, and you gotta fix it. Or, you have to be patient, because the time isn't right, trends are against you or people haven't discovered what you're doing yet, they don't understand it yet. So, it's patience and perseverance, but you just gotta get started.

Dan: Absolutely. It's interesting you mentioned Steve Demos. Great story, actually, I worked for the guy that sold Steve the equipment when he started making tofu. I remember when we started looking at it, I go, "What is this gelatinous cup?" But yet, to your point, if you hadn't been curious, if you hadn't done the things that you're talking about now, you'd be working in a law office today, not happy, punching a time clock, et cetera. Again, very inspirational. So, I appreciate you sharing that, the fear of failure.

One of the things that I absolutely love about ... One of the things that you said, "I went to a Climate Collaborative, a natural Boulder event, and everyone was worried about how do we get started? How do we do this, how do we make sure that we check off all the boxes in terms of being responsible, be a certified business, and all that other stuff?" You calmed everyone down and you said, "Wait a minute. Start with one thing. Get that, check that off the list, and then go on to the next thing." The point was that everyone was so worried, kinda what you just said, about how do they accomplish everything yesterday? You're saying, "Progress, not perfection," my words not yours. But, the way you put that, the way you were about to calm down the audience, the way you were to help them understand that moving forward is a lot more important than allowing yourself to stall and not get anything done, because as you said, you're so worried about failure. Could you go into that a little bit more?

Justin: Yeah. I think you explained it very well. My exact words, and you nailed it, were, "It's progress, not perfection."

Dan: Thank you.

Justin: I think that if people were so hyper focused on launching the absolute best food product that they can, that has all the sustainability, organic, ethically whatever, certifications on it, the world may not be ready for that just yet. Or, they might not be able to make that product just yet, 'cause they can't line up all those certifications. So, I think it's just as important to have a plan. Your plan is, "We want to have that type of food company, that type of product someday. We want to be 100% organic, raw sprouted," whatever. But, today that product may not be the right product to launch with, so today we're gonna start with this product. Every year, we're gonna renovate it and make it just a little better and the goal is to get to this standard up here.

So, basically, what we've done is ... We started with a food product that isn't perfect, right? But, I think it's a lot better than what's out there. Our goal is every year to make it a little bit better, to make sure our supplies is stronger and more sustainable, that our secondary ingredients are organic, everything is now non-GMO certified, and every year just keep making it stronger and stronger and stronger, with the goal of getting it exactly where you want it. What's good is if you don't get to that goal, somebody else, your competition, they might beat you there. If that's what consumers are demanding and your competition beats you to that goal, then I hate to say it, but your competition deserves to win. So, it's really about listening to your consumers, but also trusting your gut, and it's progress, not perfection.

Dan: Thank you for saying it. In fact, it's interesting, I just finished writing my ... I have a weekly newsletter that goes out to a huge group of people every week. The focus of this week, my tip of the week, is about goal setting and why that's so critically important. So, thank you for sharing that, because most brands that I work with or that I mentor, et cetera, they don't think about this as a strategy, and yet it just boggles my mind that this is the one thing they can do. How do you hit a target that you're not aiming for? How do you become a brand, like an iPhone, a Tesla, a Justin's Nut Butter, et cetera, if you have no idea of what you're shooting for? Then, going to the next point, listening to your consumer, there's absolutely nothing more important to any brand than to know your consumer, know exactly who your shopper is.

By the way, I forgot to mention that when I was talking to Peter Burns on the podcast interview a couple days ago, we were actually talking about you. He was talking about your enthusiasm about 'what am I gonna do next?' and how he had to tell you to cool your jets, but he's such a huge fan of what you've done and where you've gotten this brand and what you've been able to do with it. So, I forgot to throw that out there. It's so much fun to work in this industry where you've got so many people with bright eyes that are looking forward to what's new and how to really help brands.

One of the things that you said, I wanna go back to that, is you're talking about how you were looking for a company that could help you with the food safety. I agree, that is so very, very important, especially nowadays. But also, more importantly, a brand that could help you grow your brand. You were talking about Hormel, and I know the company fairly well, huge fan of what they've been able to do, the way they've pivoted and really began to start focusing on natural and organic, and using you as one of those touch points. How are you able to help them, one, and then how do they support you and allow you to remain focused on your core mission without commoditizing you the way so many big brands do?

Justin: Yeah. How do I support them? I support them by speaking up.

Dan: Good.

Justin: I think that what's tricky is when you get into the big food business, people are there because they want to advance and further their careers, they wanna look good and they wanna do well and they wanna move up. A lot of times when you speak up, you jeopardize, potentially, your opportunity-

Dan: Mm-hmm (affirmative).

Justin: To move up, 'cause it can be controversial. You could step on people's toes and people are too nice. What's nice is, in the position that I'm in, they want me to speak up. They need folks to speak up. So, number one, my role to them is to speak up, to speak the truth. They live in a bubble and I live in a bubble. Boulder, let's not kid ourselves, Boulder's a bubble. So, we both live in separate bubbles, I speak some truth and they speak some truth. So, it's good to learn from each other. What was your other question there, Dan?

Dan: Well, what I was getting at is-

Justin: It was a two part question.

Dan: Well, how do you help them and how do they help you? How do they allow you to remain Justin's as opposed to trying not to commoditize you like so many big brands do?

Justin: So, at the end of the day, they've learned that the consumer ... it's all about the consumer.

Dan: Mm-hmm (affirmative).

Justin: Really, for big food companies ... really for almost any company, it's about growth, right?

Dan: Mm-hmm (affirmative).

Justin: The consumers have the power and consumers decide what brands they wanna support and how they wanna spend their dollars. So, if consumers decide that they don't wanna support the values that companies like mine have around high quality, healthy food products, better food products, sustainable food products, community engagement, all those things ... If consumers decide they don't wanna support those types of products and companies that support those products, and our sales end up declining or not meeting their expectations, they have every right to say, "Hey look, you know what, Justin, we don't see the same future that you see, because your performance does not indicate that you have any idea where the future is. So, we're gonna basically run the company the way we think is best." That's not what they want to do. They don't want to run this company, because they feel that we do have our finger on the pole, so what the future of food is. Now, the only way that we're validated, that we actually do know what the future of food is, is if consumers continue to buy our products.

Dan: Right.

Justin: And, growth around velocity. Growth around household penetration. Doesn't have to always be just sales. So, really it comes down to ... we're gonna have the keys to the car, as long as we demonstrate that we can drive it effectively. If we get to a point where we lose touch with our consumer, and we aren't delivering on the expectation of creating products that they want, then quite frankly, I don't care who owns the business, you're not gonna have a business anymore.

Dan: Well, I agree with you completely. Going back to one of the things you said, your mission ... Or, not your mission, but one of the things you're trying to do is change big food to help them become better. I guess where I was going with that is that a lot of small brands are demonized for selling out, for working with a big brand like Hormel or P&G or someone else, Kellogg's, doesn't matter. I've always been on the other side of the fence, yes, there are big brands that have destroyed small iconic natural organic brand, that's true. However, if you have the ability to change a big brand from within, that certainly a lot impactful than to demonize them, et cetera. One of the things that you said that really resonated is that, first of all, they don't understand the consumer, then secondly, they're struggling or trying to understand the future of food.

One of the things that I wanted to ask your thoughts about is the incentive structure ... I wanted to get your opinion about this ... The incentive structure that big brands have is really screwed up, that's the first thing I think needs to be fixed. What I'm getting at, is they are incented on growing sells year over year, quarter after quarter, et cetera. They're not focused on the consumer that buys the product. So, when they bring you into their portfolio, that's a radical mind shift for them. What I mean by that is, in comparison, you are a very low velocity brand compared to their other brands. So, for you to be able to help them understand that at the end of the day, if they don't sell anything they don't have a brand, they don't have a business, and help them understand or help educate them on why your consumer matters, that's what big brands need. So, as you're working with these brands, with Hormel, how do you help them understand what makes natural natural? How do you help them understand what the future of food looks like?

Justin: Yeah. I think you can sum it up pretty easily by really guessing the value of a triple bottom line.

Dan: Right.

Justin: I think that corporations really are only focused on profits, and profits based on the expense of a lot of other systems that are broken. We don't take into effect the externalities of a lot of other things that are important to a healthy business and a healthy ecosystem. So, one of the things that we're really trying to demonstrate to Hormel Foods, and all food companies, and they've heard it, and they're seeing it, they're slowly getting it, is the triple bottom line approach. To value not only profits, profits are what make businesses successful, but people, people within the organization, people within your community and the people that you're servicing through your products, and also the planet. So, I think that if corporations can value those three things and measure those three things as a sign of success and as a sign of health, I think that people are really gonna show up for those companies and those brands, and I think all of society will benefit.

Dan: Absolutely. Could not agree with you more. That goes back to what you were saying at the Climate Collaborative meeting, how you're talking about how this movement ... again my words, I prefer to use your words, but my words ... is that how we're changing things from within, how we're effecting change on a small scale and how the bigger brands or the bigger companies are really beginning to embrace this, because they realize that this is the future. This is what their customers want. Their customers, the ones who are opening up their wallets, are gonna go out of their way to choose brands that align with their missions.

So again, thank you for all you do in this industry. One of the things, and I know we're coming close to the end of the time ... I wanted to ask you, one of the things that I've been doing recently is giving you an opportunity to ask me if I could help solve any of your bottlenecks. Anything I can help you with?

Justin: I haven't had a change to think about it. You kind of blindsided me. Goodness, no, no. I think it's a great question and I think it's one that I have to get back to you on. I think my biggest bottleneck, to be honest with you, Dan, is how can I create more time in my life so I can get more done? I need to like ... We need to create a pause machine, so we can go around and do all the things we need to do, and then press play again and get back on with our lives. I just think that it's so much fun to be involved with so many things. I get to help and see so many other organizations grow and prosper, and hopefully be a ... change the engine in big food and be an agent of change in our community. Also, at the end of the day, I wanna spend time with my wife and my kids and with myself.

Dan: Yeah.

Justin: So, it's just ... I think I need help at creating more time for myself.

Dan: Well, the simple answer ... I mean, everyone ...

Justin: I need any secrets you have on that.

Dan: Well, everyone's asking the same question, I struggle with that, too. I guess, my only answer for that is you align yourself with the right people. You come on a podcast like this and you share your insights and you inspire somebody else, then someone else picks up the baton and runs with it. But, as far as you specifically, you find the right people. As an entrepreneur, you said this earlier ... thank you for saying this, that there are a lot of things that you're not good at, there are a lot of things that you don't wanna do. So, find the people that can take that off your plate, so that you're not mired in the minutia, so that you can focus on the things that you wanna do, the things that inspire you, the things that really enrich your life.

Kinda going back to where I fit into this puzzle, category management, the advanced strategies that the big brands use that I'm trying to get these smaller brands to start adopting. The strategies that you've mentioned here today, is if you get the right people, and you build that runway, and you can do it effectively, and you'll align yourself with the right people and the right strategies, you can develop a relationship with bigger brands with retailers, at the end of the day, that's how you start carving out more time for yourself. That's how you're able to live a more balanced life. Really, I think that's the holy grail, is to try to have a healthy balanced life and healthy balanced approach to what you're doing.

So, again, I'm thrilled to be a part of this community. I'm thrilled that you made time for me today. If there's anything I can help you do ... By the way, if you wanna call me up, before I get this thing edited, and ask me a question specifically, I would love to include that, or if you think of anything in the future, I'd love to be able to help.

Justin: I appreciate that. Let me give that a bunch of thought.

Dan: I would welcome the opportunity. But, in terms of where you're at and what you're doing, know this, you're making a tremendous impact. There are small brands out there everywhere, even big brands, that are looking up to you and saying, "I want to be like Justin. I wanna have the same hair," just kidding. Although, mines almost gone at this point. But, to be able to have that work life balance, and again, I can't thank you enough for what you've done in this industry. Again, as an athlete, one of the things that I used to use for an energy source, a quick energy source, is either cheese or protein. Well, there's some issues with taking cheese with you on a bike ride, but having peanut butter just makes so much sense. The fact that you put it into a squeezable pack, gosh, I wish I had that when I was going to college. Where were you? But anyhow, thank you. I really appreciate this. So, thank you for coming on. Thanks for your time today, and if I can help you in any other way let me know.

Justin: Thanks, Dan. I really enjoyed your questions. I look forward to seeing you at the fall Naturally Boulder event.

Dan: Absolutely. I'm looking forward to it.

Justin: All right, my man. Hey, you have a great day, a great week, and I'll talk and see you soon.

Dan: Looking forward to it. Thanks, Justin. Take care, have a nice evening.

Justin: Thanks, Dan.

Dan: Thanks. Okay, bye.

Justin: Take care, bud. Bye-bye.

Dan: I'd like to thank Justin for coming on today and sharing his insights. I'll be sure to include a link to Justin's on this podcast webpage and in the show notes. This weeks free downloadable guide is my Strategic Solutions to grow your brand. In this guide, I cover the basics of category management, what you need to know to start building the strategies necessary for you to compete head-to-head, toe-to-toe with your more sophisticated competitors. These are the strategies that the big brands use. Simply put, if you wanna play at their level, you need to be at their level. More importantly, these are the strategies that are gonna help you stand out on a crowded shelf across all channels. These are the strategies that are gonna help you help your retail partners grow sales and compete more effectively. Don't forget to also check out my free Turnkey Sales Story Strategies course. This is the course that's gonna give you the healthy, sturdy foundation to help you grow sales on. It can help give you sustainable and significant competitive advantage. You can help get them on this weeks show notes or on this podcast webpage by going to brandsecretsandstrategies.com/session91. As always, thank you for listening, and I look forward to seeing you in the next episode.

Justins http://justins.com

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