How does a former pro NFL player launch one of the fastest growing meat snacks in the country? If you think it’s only because he was a celebrity athlete, think again. Gabe Carimi switched gears from playing for the Atlanta Falcons to assembling a team of business all stars and working both smart and hard. This episode is packed with advice for anyone launching a consumer packaged good, but especially one in the food or beverage space. This is an extremely wide ranging conversation – we talk about finding the right partners, acquiring manufacturing, stifling competition, getting into major retail chains, marketing and sampling, and why direct-to-consumer online sales isn’t the future they’re chasing. Here’s another interesting thing: All three co-founders are very, very wealthy. So why did they take on outside investment capital? Also, what the heck is Biltong? If you’ve ever wondered what it takes to bring a food product to market, our conversation will open your eyes!
01:40 – What is Biltong?
05:07 – Why start a meat snack company?
09:45 – The challenges of doing something new.
20:00 – The founders were wealthy, so why take on outside capital?
21:08 – What does Gabe do as CEO?
22:23 – How’d they get into Walmart? And attract top talent?
26:45 – Does a pro athlete’s celebrity status really help?
29:20 – How fast do you want to grow?
32:00 – Why brick-and-mortar retail is more important than Amazon.
36:54 – What’s their marketing strategy?
44:08 – Setting your pricing.
47:42 – What operational challenges keep him up at night?
50:44 – The costs of playing in this category.
POST GAME ANALYSIS:
What I found extremely interesting about Gabe’s story is that they didn’t necessarily know exactly what their product was going to be. They had an overall goal of creating a healthy snack, but they had to experiment with different ideas and ingredients before they found the right idea. And they had to learn a new set of rules. His business partners owned (and had sold) two of the U.S.’s largest workout supplement companies, Dymatize and ProSupps. For a supplement, you only need to follow the right labeling laws and you can launch a product. When you want to launch a food product, especially one containing meat, you have to ask the USDA for permission first. And to get that permission, they had to convince the USDA that the Biltong process was safe and the manufacturing plants met their standards.
“Learning from the NFL, it’s about the team you surround yourself with. The secret ingredient in a winning team is surrounding yourself with people who win.”
Another interesting part of their plan was acquiring the manufacturing plants. There were (and currently are as of this episode going live) only two facilities in the U.S. approved to make Biltong. Stryve is building a third location in the midwest, but they bought the two existing ones, giving them 100% control of the supply chain. That’s a big competitive advantage!
Why raise money from outsiders?
Gabe has two very good reasons for raising money. First, they wanted to grow quickly. To do that right, they need a lot of money to fund manufacturing growth, marketing, sales and hiring. They’re in a good position of owning the Biltong market for now, but to cement that position before the competition comes, they need to make a name for themselves quickly. Ramping up to handle a national supply chain and support major retail chains like Walmart and GNC, among others, is very expensive.
The second reason is less obvious but extremely important: They wanted to maintain a positive working dynamic between the co-founders. They all had money to invest, but one of the three was far wealthier. Supposing one of the partners put way more money in and had way more ownership, the others could end up subject to the whims of the majority shareholder. While we all like to think our friends and co-founders will always do the right thing, it’s better to structure your business and ownership status to ensure it. For Stryve, they decided to bring on outside capital to get what they needed rather than let one person unbalance the partnership.
Here’s another surprise: It wasn’t Gabe’s status as a former pro athlete that helped them so much. It was the network that their investors brought to the table. These people had money at stake, so it was in their best interest to help assemble an A-list team. This is a powerful resource that anyone taking outside capital should take full advantage of.
How does a new brand get into Walmart?
You might think a former pro athlete can walk into any buyer meeting and get a product on the shelf because they have some celebrity status. That’s now how they did it. Stryve took advantage of two things: First, they had a product in a popular category that retail buyers were looking to grow, and looking for unique products. They hired away sales people from other major food brands who already had strong relationships with the buyers at the retail chains.
How do you find good sales people?
But how do you find these people? Your investors might be able to help, especially if they’re larger institutional VC firms or similar. Barring that, start with LinkedIn and search for the people doing that job at your primary competitors. Post on the major online job boards. Then vet them carefully. I speak from experience when I say the food and beverage industry is full of con artists and bullshitters. Double and triple check references, and trust your gut. If someone’s references don’t check out, or they don’t seem legit (as in, you can’t actually contact any of them), or if they’ve bounced from start-up to start-up, then you should run. The latter is a good indication that they prey upon founders who don’t understand their industry and are naive in hiring, so they make big promises, charge big retainers, deliver nothing, then leave when the company is struggling. They will drain your bank account and your morale. Stay away from these people.
Start small, start online, then grow
Supposing you don’t have the resources Gabe did, or you don’t want to take outside capital right from the start, he recommends starting to sell online. The benefit of this is that you can prove your product and learn about your audience. Refine your marketing and get your product and message dialed. Then you have something to show both investors and retail buyers.
What’s their marketing strategy?
Gabe says they plan on using 20% of their product/revenue will go towards sampling, and most of that will be done through their own street teams that exemplify the healthy, active lifestyle they want their brand to portray. This is key because you want to control your brand’s image, and your sampling team is an extension of your brand. They prefer this over using store-run programs (think “Costco lunch ladies” sampling your product).
The other part of it is influencer outreach, sending samples to bloggers and media, with a particular effort going toward millennial parents who shop at natural foods grocers. Seems narrow, but they know who’s buying their product, so that’s where they’re starting. When you’re just getting going, there’s no point in shotgunning your efforts to reach everyone. Find who your core customer is (think about what problem you’re solving and who you’re solving it for), then focus your energy on that. You can branch out from there later.
Gabe mentions the phrase “trade spend”, which for meat snacks is particularly high. Basically, this is all of the marketing and slotting costs of both getting your product into retail and making sure people know about it and seek it out so that it’ll sell through. For them, category leader Jack Links spends a ton of money to make sure they have a large shelf presence in convenience and grocery channels, and to make sure you’re familiar with the brand. Thus, they dictate the trade spend necessary to compete in that space. If you can’t outspend your main competitor, you need to be able to out think them and find other ways of gaining awareness and creating so much demand for your product that retail buyers will want you in their stores regardless of your ability to pay for shelf space. Or, at least, maybe they’ll cut you a deal.
Gabe’s advice for entrepreneurs
Get the best team you can, and do whatever it takes to get the job done. Everyone needs to have the same drive and hunger for success, so you need to find the right people that share your drive. Partner with people you know and trust to perform at the level necessary to achieve success. And when it’s time to raise capital, find the smart money that brings advice and other resources with it. Find the investors that are willing to put their time and energy into helping you succeed, too.
LINKS & RESOURCES:
- Find the brand on Facebook, Twitter, Instagram and YouTube, as well as LinkedIn.
- Find Gabe on LinkedIn and Instagram.
- Gabe mentions Truff Hot Sauce as a small brand doing it right.
- Their new facility is opening in Oklahoma, which Gabe says has been extremely helpful to them. Check out OK’s Small Business Development Center if you’re interested in learning more.
- Explanation of this episode’s sign off is here.
Like this? Want more? Leave a comment or send me a note with what you’d like to learn more about and I’ll find a great guest with the answer! And please take a second to leave a quick review or rating for me on Apple Podcasts or Stitcher…it only takes a minute, but it helps SOOO much! Thanks!