SkinnyDipped: Breezy and Val Griffith. The Flourishing Snack Company That Almost Failed

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1:30 Dot com And tell us how we can help you. I will never forget the image of my mom sitting there. I walk into this kind of And she's sitting at the table with like hundreds of nuts that she's bitten in half. And

1:53 Just pale look on her face. And she just said th there's nothing we can do. They're rancid. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements.

2:15 They built. I'm Guy Roz and on the show today, how a mother and daughter joined forces to make a new kind of chocolate almond and grew skinny dipped into a multi-million dollar brand. Here's something crazy about American snack food compared to similar products in Europe. There is more sugar in ours. Part of that is regulatory. EU law has different rules, but another part is what's known in the snack food industry as the sweetness profile. Basically, how sweet people like things to taste.

2:59 And when it comes to American taste buds Our sweetness profile is apparently really high. Or at least that's what snack food brands have thought for decades. But it turns out we may not actually like things so sweet. And it helps explain the recent boom in products that are still sweet, but with a far lower amount of sugar.

3:20 Products like Olipop and SmartSweets and Simple Mills cookies. This was the trend that Val and Breezy Griffith saw back in twenty thirteen when they came up with their idea for chocolate-covered almond snacks. That was a longtime local TV producer in Seattle. Her daughter Breezy was a few years out of college and trying her hand at different business ideas. Both of them loved chocolate covered almonds, but they realized that in most cases, you get like twice as much chocolate than almond.

3:50 And they wondered. Could you put an ultra thin layer of chocolate on the almond? Enough to make it taste good, but with a fraction of the sugar. But turning that idea into a real product, one that could be made consistently, sold at scale, and survive in one of the most competitive categories in retail? That turned out to be much harder than it sounded.

4:13 Along the way, they had to figure out manufacturing, distribution, branding, and eventually how to make a fast growing business actually work financially. Like so many previous guests we've had on the show, the founders here were so focused on making a quality product and on growing the company. that they lost sight of the most basic goal of a business. Making money. And for a while the brand was in a perilous financial position, which we'll get to.

4:41 But before all of that, and before Breezy and her mom teamed up to start Skinny Dipped, Breezy was living in Miami, where she was trying to come up with different business ideas. I shared a one room apartment with four other girls that didn't have a kitchen. Uh we slept on beach towels. I'll forever remember that. So I just I decided and this was probably my first foray into food. I decided I was going to start making these Organic sorbet and selling them at the farmer's market. I found a commercial kitchen that would only rent to me between the hours of like eleven PM and four AM in a pretty

5:20 a sketchy part of town. I would go there with my Two pint ice cream maker. And I would make these just pure organic sorbets and then I would pack them up, put them on dry ice and take them to the farmer's market and sell them all the next day. Like frozen in cups. Or like scoop scoopness.

5:41 frozen, individually frozen in cups. Wow, and did you w I mean, had that been a thing that you did, like cooking and and baking and like was that something you were interested in? I didn't realize that was something I was interested in, but my mom was this incredible Self taught cook like

5:59 Everyone always wants to come to dinner at our house. They always have my entire life. And so I had learned by osmosis without even realizing it. But I know zero. Абсолютні зірова фінанс. Any of that. I mean I guarantee you I was just lo I was doing all of this work and losing money. So what I mean, what happened to that idea? Did you d at some point did you just sort of

6:22 You know. Naturally fizzle out. Yeah, I mean it it just wasn't sustainable. So I was, you know, going making these teeny tiny batches of ice cream through the night. I you know, trying to stuff it all into my freezer. As I said, definitely losing money. I had there was no thought into, you know, how would you scale this or make more. So I started making sandwiches.

6:45 And I would go And buy all of my ingredients at Publix and I would make these sandwiches. And again quickly realized that I was definitely losing money. And that's when I went

6:59 Maybe I should be going to a restaurant depot and finding these ingredients. And I think what I didn't realize at the time was happening is I was building these micro businesses z teeny tiny businesses Really what I was doing was Cultivating a skill set by failing.

7:16 So all right, so you're you go to sandwiches and then I guess at a certain point you leave Miami and move to New York. Tell me about what was going on in your life. Why did you Do why should you that you're not going to be able to Yeah. I think I had friends at the time who lived in New York and

7:33 Who Loved it. I I was look I was excited for more to be going on. There was somebody I was dating in New York at the time, so I thought I'm gonna make the big move, and I will never forget. Going from Miami to New York.

7:46 I pretty much didn't eat for the first couple of weeks because I didn't even know how to get in line at one of the bodegas and and order a sandwich, cause New York was this, you know, it was Chaotic and bustling, and I realized pretty quickly that it had an energy I had never experienced before that. I really resonated with. So In in New York.

8:08 Tell me a little bit about what you were doing there. I didn't want to go and look for a a job. I wanted to continue to Try to Build a business. And so I opened a very, very small business out of this teeny tiny apartment called Sweet City Bites. And I would make

8:27 Cupcakes, I would make uh birthday. I would roll Fonden out. I'll never forget. I would have to put like cover my floor in my apartment with paper and then roll Fonden out'cause it was the only place I had enough space to cover these little birthday cakes. And then I would get on the subway and I would deliver them all over the city. Again. Definitely still losing money at the time.

8:53 Yeah. So all right, so you're You're living in New York, your obvious your your family, your parents are in Seattle and You're going to visit them now again, I guess Uh from what I understand

9:06 Around twenty twelve. You're in New York. um a very close family friend who uh uh a guy named Josh Dickerson, he was a young guy He he passed away, he died. He had um a very rare form of cancer and he was just eighteen. And this really like

9:22 You guys were really close with this kid, right? I think he was even he had dated your sister. Tell me a little bit about About this. this was going to actually affect a change in your life. Yeah. It was horrible. And you know, and he'd gone into remission, and we didn't know him at the time, my younger sister

9:40 Emma. She met him, you know, right after he'd gone into remission. And when we found out that the cancer was back, I started coming flying from New York back to Seattle to support. My sister. And I would go back and forth between the two places and As we

9:58 started to get more information about Josh's diagnosis and it became clear that it was terminal, those trips became longer back home. And I had been living this kind of fast paced, exciting life, and this started to become a reminder as to what really mattered the most and what was most important. And I Really started to feel that urge to spend more time with my family and my sister and my mom and my dad. So then that was eventually kind of what prompted part of my move back to Seattle along with launching Skinny Dipped.

10:34 Fal I wanna bring you into the conversation. at this point'cause I I this is I think around two thousand thirteen. Uh you were living in Seattle, where you had a career. As a freelance TV producer, Um so you had some flexibility, right? But all also maybe I don't I don't know, I mean tell me a bit.

10:51 about how you started to talk to Breezy about this. Um because I mean at this point you were maybe in your late forties or early fifties and I I think I and only say that because I you know I uh people who know this show well know how much I love first time founders who are in their late forties or fifties or or even beyond. Um'cause I think a lot of people you know, think that you have to found a business when you're we are twenty two or Uh and that's not actually true at all.

11:17 So t tell me a little bit about Just this idea of like starting something with your daughter, like starting a business. Yes. At the time that Josh passed away in 2013. At that time I'd been working um as a

11:32 Producer on this Travels to the Edge with Art Wolf, which was a super exciting job for me. So I was a little bit at loose ends as well because it looked like we weren't gonna have another season and as you well know, in the freelance world you're always looking for the next gig. Yes. Uh And I wasn't sure what the next gig was. And coupled with that, we had really I had really pulled myself in some ways out of the workforce for the year that Josh was sick because um It's really an extraordinary thing when you walk a family and you walk a child through an illness like that.

12:09 And we happen to be one of the families that uh that they were that Josh's mom and dad were very close to. And there was sort of this village the closed in a around him. So I had literally kind of taken a year off of my life to be sure that I was shepherding our younger daughter through this journey because I wanted to make sure she was okay. She was only she was fifteen and then sixteen at the time. Yeah, I read an I I read an article up about Josh. There was a a a profile on him in the Seattle Times uh from the from that from when he passed away and

12:41 Obviously he was I mean, you can imagine how traumatic that was for his family. He was a baseball player and even played dur while he was in, you know, undergoing treatment and I mean it's it's and so As a parent myself, I can understand that response of saying, you know We just saw this just tragedy happened to to friends of ours and

13:03 Let's just You know. Not forget. what's important. And and so for you it was like let's just spend time together. Yeah. And Breezy, you are clearly

13:13 coming back to Seattle. You were you were gonna come back and live near your parents. Yeah, those stretches that I'd started coming back from New York to Seattle were getting longer and longer. And as the idea developed and got real. I made the choice to fully move back to Seattle and move back home and in with into the you know, the house I grew up with with my parents. So it was a big it was a big life change. I'd gone from, you know I remember at the time, you know, I was going from New York, it was buzzy and fun and very social and Seattle, especially at that time was quieter and uh so for me if I'm a you know, being in my twenties, it was a big change to go back home. I think too, Guy, for me, I was facing

13:55 kind of empty nesting was looming large. So I think the timing it was That played into the timing because I'm not sure that That I was Looking forward to

14:07 I don't know what I was looking for b uh at as an empty nester. Yeah, I mean you're going from teenagers in and out running and out of the house and friends and cooking and to but to and this is something that you know many people face in their late forties, early fifties, and or you know, even beyond, their kids are gone. And then it's like okay. This is the next chapter and and what what does that mean?

14:30 Right. So Oh so here is a potential opportunity to do a project with your child, which is amazing. Tell me a little bit about what you start you're you were a great home cook. Your kids obviously had absorbed some of that. Talent.

14:47 And you guys start talking about, let's maybe do some kind of food thing, T Tell me a little bit about some of the ideas you start to bat around. I think we had a bunch of them, uh including We talked about doing Thin cookies?

15:02 Thin cookies. Thin cookies. Yeah. We were constantly looking for like girl snacks. Yeah. And You know, um snacks that would give you a little a little bit of energy and o and we couldn't find them. We couldn't find these delicious. better for you kinds of snacks. And so I can remember that we would go into Starbucks and we would look at the co you know, at the at the pastry case.

15:29 And Most everything in there that was some type of um carbohydrate. Yeah, hasn't changed, by the way. Right. So I think that that's that was the driver was sort of Girl snacks that were both like

15:45 really delicious, but also had some redeeming value to them. And we've never been a huge sugar family. Uh my mother when I was growing up it was not allowed tap soda pop. as we used to call it. Um We never had candy in the house. The only

16:02 Uh you know, so I grew up in one of those households, so I think I carried I carried that with me as well. Yeah. It sounds like you were you were already moving in this dire this this direction of like Things that

16:17 That you liked, but like smaller version of smaller portions. Is that fair to say? Yes. I was just say, I think the other things that we were considering with were the It was

16:28 Really Kind of my mom's Part of my mom's cooking philosophy was Whole foods, right? Things that we were very early to this trend that we're really starting to see now, right? Like minimally processed real foods. I grew up in you know what has been coined an ingredient house. You wouldn't open the cupboard and find a bunch of

16:49 Yeah, snacks and processed foods. You had to make something if you wanted to have a snack. I grew up with, you know, my peanut butter and jelly sandwiches were home made jam and peanut butter that came out of the grinder. And so I think we also started talking about it was portion control. It was also something that you could Grab and take with you that you felt good about eating. And there wasn't a lot of that that existed then. Yeah.

17:14 All right. So you guys are are are sort of batting ideas back and forth. In your mind, Val, was this serio was this like really serious? Like were you sort of thinking, we're really gonna do something here. Or in the first year or so was it still just like This is fun.

17:31 Yeah. I was I was going forward with great trepidation is the truth because I know my daughter well and I know when she sets her mind to something that it's very likely uh it's it's a go. Uh I was excited, but In truth, I was pretty exhausted by the year with Josh and My previous gig

17:56 It was very stressful. At times the production was stressful, and so w what I didn't want was to hop into a situation that was going to be highly stressful again. So I think when I went into it. There was a sort of a little bit of naivete on my side as well. I thought we were going to the farmer's market. You know, we were gonna put something in a jar and we were gonna tie it, and we were gonna sell it, and we were going to sort of build from there.

18:24 So I think that I was committed to moving forward, I didn't really know what I was getting into. Yeah. All right. Breezy, what do you remember about I mean what I I I read that you guys took like a road trip at a certain point.

18:39 Was this like a w where did you go? I mean was it just for for fun? Tell me a little bit about it. Yeah, so we were taking my younger sister. Emma. Up to her first day of college at University of British Columbia, where I went. And It really

18:56 It it came out of this, you know, we were just Having conversation, we were snacking like you do on a road trip. My mom had, you know. good roasted almonds with her'cause she was a very healthy eater and I had brought, you know A quote

19:12 Naughty snack. I think I had You know, I had a peanut butter cup with me, and I knew that that wasn't, you know, healthy or something that you would eat regularly, but it was delicious. And It really kind of just got us thinking. Maybe there's this intersection between Whole foods.

19:30 and deliciousness that we can strike and We really started talking about how Chocolate almonds in particular had been this they were this dated, boring product that were sitting in bulk bins. And could we reinvent it to become a snack? And kind of like We thought about it a little bit like a deconstructed nut and fruit bar, but in a more snackable fun way to eat it in pieces.

19:57 And so when we got back from that road trip, that's really where We started experimenting in the home kitchen. So I wanna so you're you guys were t were talking about fruit and nut bars. I'm thinking of like the Cadbury's fruit and nut bar, right? That chocolate fruit nut bar? I think more almost like what Kind was doing at the time. Because Kind bars were unusual. It was like just nuts stuck together. in a bar. Exactly. With like some chocolate, you know, a little bit of chocolate on there. Mm-hmm and and I think we felt like especially how we wanted to snack, like a lot of women snack, you eat a little bit, you know, you eat a few pieces, you close up the bag, you eat a few more pieces, and so

20:35 Uh Think it was this idea of Can we get Something that is good for your body, but tastes As good or as close to as good as a chocolate chip cookie, and then put it in a fun format.

20:49 Yeah. Alright, so tell me how 'cause I I f maybe it was on this road trip, maybe that's apocryphal, maybe it didn't really happen that way. And it doesn't m well, I'm I'd be curious s t to get your sense of how you remember you landing on this idea of chocolate covered almonds um because chocolate covered almonds are delicious, right? Like you could go to the bulk section of like safe way and

21:11 You can uh if they have'em, but you and you can find them. And they're usually like these giant sort of, you know, like oval shaped chocolate gobs with a with an almond in in there, and they're shiny and they're delicious, but there's a lot got to be a lot of sugar in those. Tell me how you start to think about Chocolate almonds. Uh you just told part of our story there, I think, because

21:34 I would go to the grocery store. I love chocolate. I would go to those bulk bins. And I would Buy some of those Those nuts, those big as I call them, chubby nuts, bowling balls of chocolate.

21:47 You know, and somewhere inside of that great big ball glob of chocolate there would be something that resembled a nut. And I remember it different from you, for me they were not delicious. They were like woefully disappointing. Because uh there was no balance between the nut and the chocolate. And I also didn't think the chocolate was very good chocolate. There was also a uh chocolatier in town, fabulous Seattle chocolatier called Franz.

22:17 And France had a chocolate coated almond that was, in my mind, perfection. It was expensive. And I didn't have the kind of budget where I could buy those very often. But from time to time I would, and uh there was I made such a huge difference between what this chocolatier was producing, which was a thinner coated Um almond that was treated thoughtfully, and I just thought

22:45 Why can't we do something like that? Yeah. To me it sounds easy, right? You just you just take almonds and you just roll'em in br in in some uh melted chocolate. And then you just put'em on parchment paper and there you go, you got your chocolate, right? Yes and no. Is that we is that what you started? That's what we started to do. That was the sort of the starting point. Um

23:10 True confession, we might have taken those Franz Almonds and very, very, very carefully deconstructed them with a knife. Because I knew because of My palate, I knew something else was going on there. It wasn't just an almond, a raw almond that had been dipped. There was something there was some other little piece of magic in there.

23:33 And I think again because I had taught myself to cook, this is kind of how I approached food was like, ooh. I'm gonna sleuth this. And see what it is that makes this Delicious. Okay, let's just talk about the science of this for a moment because

23:48 I Again, like I think most people think, Okay, an almond, it has an almond skin on it, and if you dip it in chocolate, that just stays on there and then if you let it drip, like it's a thinner coating of chocolate. But that's not what happens, right? What does chocolate just slip off an almond? No, you can make that happen as long as you temper your chocolate. Like you could do that. You can like you could you could do that tonight. And you could have a a thin dip.

24:16 Diped on it, but it wouldn't taste like ours. And it would also probably be hard to do like a lot of them. Yes. Yes, we dipped them on forks for a long time and quickly realized that was a not a viable option. And if you were considering selling those that you had made on your Kitchen table. You had the same problem um that

24:38 The bulk bin's were the bulk bin almonds were trying to solve. You had to finish them somehow so that they could be kinda protected, the chocolate could be protecting. Otherwise it'd melt to they just melt together a bit. Yeah. You would have problems. Yeah. So okay, so this is actually a much more complex problem than now that that you guys probably even anticipated. And and before I I I so I wanna'cause really want to dive into h in this process, but

25:04 You know we've we've done a lot of confections, food on this show over ten years. And I know that around this time, even before this time, the Um people were really starting to get interested in

25:18 Alternative sugars, coconut sugars, maple sugars, but then even stevia. 'cause Stevia i and and you got Lily's, they were using Stevia. Uh people were you know, there were there were Some entrepreneurs and brands that were like let's move away from Sugar.

25:35 Um you guys took a different A different approach, which was let's not do that. a lot less of it. Tell me tell me about the thinking that went into that. I think moderation was always a part of our formula. You know, that um less is more.

25:53 I mean, again, I think all of this goes back to the way we ate. And we ate in moderation. We didn't eat a lot of sugar and and if we just could reduce the sugar. Like kinda the way we eat. Just Do less.

26:07 But but still make the product sing. So okay, um Let's let's go back to the process of getting A thin coating on chocolate because but even if you get a thin coating you still have to Protect it if it's in a bag.

26:22 Because you can't sell individual almonds'cause that's just doesn't make sense. And who's gonna pay, you know a dollar for an almond, right? And and just the labor cost of like dipping each almond. I'm thinking like you need tiny fingers to do that. You need like a tiny elf. Like a whole army of tiny elves dipping them one by one, and that just doesn't make sense because the elves are expensive. You're paying minimum wage to thousands of elves. Impossible to do. So what other ways were you trying to get a thin coating?

26:50 On an almond. So we spent a lot of time in the kitchen trying to just make Make this taste good. And we did try a lot of different sugars. We tried Um

27:00 molasses a whole variety of sugars to to kinda get this little added tiny tiny hint of sweetness that we felt we needed above and beyond the chocolate. And again, I think we're we were looking at artisan and culinary techniques when we were thinking about how to make this thing. The roast on our almond was really important. When you roast an almond to a certain place, you get added sweetness and caramelization. We knew that could contribute to the sweetness. And then we put this thin coat of chocolate on. We were super thoughtful about what kind of chocolate. But as you said, um we had to figure out a way to protect it. And so we used uh an old culinary technique called truffling. And truffling is where you can take

27:45 A chocolate product. And you can um essentially sort of dust it. with something Usually cocoa powder. So with our original uh dark chocolate coated

27:57 Almond, that's what we did. So that way you it's basically creates uh a layer that protects the almonds. F and and people've had cocoa dust at alms of people listening. Yes, and then that led to our subsequent two almonds that We're part of our You know, uh

28:15 kind of suite of uh products initially. One was a raspberry almond, so chocolate coated. We dusted it in Real raspberry powder. Just like dehydrated raspberry powder. Freeze dried raspberry powder. Mm-hmm. Yeah. And then we did uh an espresso iteration. So you know. Grow up.

28:33 Espresso. Yep, yep, where we had espresso dust. So we were getting real flavors from the get go. Yeah. I mean literally when we were making these first iterations, we were making in the home kitchen, we were dipping them one by one on a fork, we were setting them on parchment paper, and so Part of the next step was How do we make more of them? And

28:56 So we brought my dad into the conversation because he has an engineering kind of mind. And one of the ideas was well Maybe we should spray them. So we went to Home Depot. We bought a paint sprayer. We filled the paint sprayer with chocolate. And the chocolate would start to harden, so you couldn't actually get it to work. So we had to

29:19 McGyver some heat guns next to the paint sprayer to try to keep the chocolate warm while we sprayed these sheet pans of almonds. And let me just tell ya, it was it was a complete failure. We just had like it just Chocolate just atomized into the air. There was none on the almonds. It didn't work at all. It did not, and we def definitely returned the paint gun to uh Homity. I mean it's kind of an ingenious idea. You would think that that would work. So what it's

29:49 What did you I mean I I read it took you like a year. Yeah. landed on what actually worked. Tummy I maybe you've got trade secrets here, I don't know, but tell me what you can tell me about what eventually worked.

30:04 So there's one more step. before we got to what worked, which was that we thought maybe it could go through a process called enrobing, where you know the the nuts lay down and they go through a waterfall of chocolate. We found someone in Oregon, a family operation. We called them up and asked them if we could essentially come and trial making our product in their facility. And they were uh really they were really Kind and they said yes, sure, come down. So We went down there and we spent We'd brought like 10, 10, maybe 15 pounds of almonds, and we spent four days on this line individually placing nuts on a conveyor belt, letting them go through this waterfall chocolate, and then hand sprinkling them with things like espresso powder, sea salt, taking them off and bagging them up.

30:51 It's like it's like Lucial Ball. Like the chocolate factory. Exactly what it was. It was that scene. Yep. We had Breezy on one end of the con of the line, you know, feeding the nuts, and me on the other, desperately sprinkling them with Himalayan sea salt. There's a foto of us. Passed out. Sleeping in the sun.

31:11 On this loading dock after Forty, we were so exhausted, and we had one cooler full. of chocolate almonds So That was also not the answer and We knew that.

31:22 When we come back in just a moment. The founder set up shop in a converted chicken coop. And Breezy walks into a bar and meets someone. Who changes the course of the business? Forever.

31:36 Stay with us, I'm Guy Raz, and you're listening to how I built this. Hey, welcome back to How I Built This. I'm Guy Rise. So it's around twenty thirteen and Breezy and Val are in Seattle searching for someone to help make their thinly coated chocolate almonds. I started to get on uh blogs, like Reddit blogs, and I started to dig deep looking to see if anyone was putting this thin coat of chocolate on, you know, on fruit, on anything, any sort of center. And I eventually found I was on this kind of like esoteric chocolate blog, and I eventually found this chocolateer who was writing these commenting about how he was

32:28 Thinly coating um I think maybe at the time it was freeze dried fruits. And so I Figured out his screen name, found his name from his screen name. Reverse looked his name up to find his phone number and then called him at his house. And I essentially just asked him, Can you make this for us? And he said

32:46 Yeah, I think I can. And that was really kind of the first step we formed a relationship with him and It was there, it was in that relationship that we commercialized our recipe. He was in Seattle. Just outside of Seattle, so it was just yeah. Yeah. Good fortune.

33:04 And you guys probably didn't have a whole lot of cash to, you know. I'm assuming you're working with Some cash, but not uh hundreds of thousands of dollars. Definitely not. We were working with a a stash of about You know, I think it was our our pretty much our life savings of about twenty five thousand.

33:22 Alright, so this is A challenge, right?'Cause you can't find a co manufacturers to do this for you. But you do have this guy in s outside of Seattle who says, Yeah, I can do it for you, but can he do it at s I guess at this point you don't really need scale. You just need to make enough where you can start to sell it.

33:40 Exactly. So how much could he do for you? Well It was a longer journey than that. So we we started making very small batches with him, you know, ten pounds, twenty pounds, thirty pounds. And then, you know, we would sit at coffee shop with him and we would kind of brainstorm about, you know, how could we get to a hundred pounds, two hundred pounds. And I think at the time we were trying to make A roadmap, a plan that got us to about a thousand pounds, maybe two thousand pounds of product. And

34:12 originally when we met him he was working out of his you know, he was making this in his garage essentially. And then he leased a very small facility to essentially start producing for us. And when I say small, this was a converted chicken coop. Uh we Bought an oven. Off of eBay one single oven that sat on the floor.

34:33 We washed all of our dishes. Outside on the loading dock on the hood of our car with ho with hose water. So this was like a serious like you know, kind of makeshift first facility where we partnered, you know, with this person to start to create a quote commercial version of our recipe.

34:56 He had the one essential piece of equipment and the skills to do what we needed. The the piece of equipment is called a pan. Looks a bit like a cement mixer. And um when you put a certain number of nuts in there they rotate around and you add the chocolate and then you know then gradually, gradually whatever layer you want builds up on the nuts or the centers. But uh yeah. This facility had no heat.

35:27 Had no hot water. had had one pan and one semi functioning oven In the middle of the facility seems like such a big word for you know, which we the place we fondly re refer to as the coop. Yeah. All right, let's talk about your your and your co you mentioned your co founders. You you bring in I think your two childhood best friends to join you. Yes.

35:54 This is uh Lizzie and Chrissy. Lizzie Resta and Chrissy Holler. Yep. So Kind of right after my mom and I Lizzy is my oldest dearest childhood friend. We met in pre school. Uh, we grew up together. She's the one that I would, you know.

36:13 build tree houses with when we were young and so And Lizzie was just Really excited about the idea. So she jumped on board and then Shortly after Chrissy, who had become kind of my soul sister when I was living in New York.

36:29 Uh Chrissy's Fiery. She's like a kind of a race horse, she was really excited about it and she wanted to do Sales.

36:38 And she joined us. So Chrissy moved from New York to Seattle. moved into the house with The parents, myself, her dog, and Lizzy lived about two blocks away.

36:51 Okay, let's go back to the The process of making them. Um, so you've got this guy Who is

36:58 making sm small ish quantities for you. Um and you've got something that tastes good and it's thinly coated almonds. And then how are you gonna sell them? Were they gonna be like individual snack size or was it gonna be like a a big bag of almonds, like how did you think about Packaging them up at first.

37:16 Yeah, so we wanted to put them in essentially kind of like a single serving, right? Because part of the idea was this grab and go on the go. So I eventually Reached out to someone in Spokane Washington who was a kopacker. And

37:32 I think we convinced him to give us a chance. So I mean he was bringing truckloads of nuts in, he was Pretty decent scale. And you know, here we were with We wanted to show up with you know two hundred and fifty pounds of almonds and pack them out or five hundred pounds. And we convinced him to let us drive a truck to Spokane, work on the line, and pack them into packages. through the night when he was the quietest. So it was the night shift and He employed a lot of

38:03 Ex cons and people that had had a really hard time in life and it was a pretty eye opening experience because we would go and we would work through the night on the line. With all these different kinds of people and we would hear their stories and we would see Yeah.

38:20 What But manufacturing is hard work. I think that was such a lesson. in in in sort of

38:29 What goes on. On the line, but also Just Kind of. Diving into the world of manufacturing that not a lot of people ever get to see.

38:40 When you know, it how is our food made? Who are the hand who who are the people that are putting putting their hands on our food. You know, how many times are they doing that? How long do they have to stand on their feet? Um without a break. Yeah. Alright, here's I I'm curious about the chicken and egg.

39:00 question which is did you be even before you had packaged these Uh. Um did you start to reach out to potential Retailers and shops, or did you was the plan let's just make You know, we've got

39:14 twenty f twenty five grand to work with or whatever. Let's just make as much of this as we can and then Try and sell them. What was the approach? I mean originally when we were making them on the dining room table, we would pack them into little clear baggies and put a label on them that at the time said skinny nuts with a Z. And

39:35 It was those that we handed out to Friends, family and like Honestly, anyone that we would meet to just get like feedback, right? And it was very positive. At that time I don't think we took those to retailers This was like

39:52 During this time it was kind of the beginning of disruptive brands and challenger brands. So I had spent a lot of time reading about Lara Bar story, pop chips, some of these you know, challenger brands. And so We knew a piece of it, obviously, a very important piece, was the product, but we were also aware that. The brand was

40:16 equally important, and so we wanted to put them in a package. We wanted to have a look and feel. Yeah. And so Now you're manufacturing them and or you're you're packaging them in Spokane. Did you already have commitments from people or were you gonna just

40:33 Collect all the bags and then start to figure that out. Yeah. I mean when we started going to Spokane, we were going with you a regular car size, you know, a few cases of nuts in the back and We would take those, we would pack them all up. Bring them back to Seattle. And

40:49 We would essentially sell Door to door. Yeah. Grab and go single servings that we would put in a box of ten. We would go march into a mom and pop

41:02 And wait for the manager and give them a sample, have them try it, and s hopefully sell them in to sit near the cash register and I mean, when I tell you like We would only take cash or check. We had no other way to take payment. And then we would go and we would demo them. We would ask this manager. Can we just

41:24 you know, can we come demo them and we would come demo for four hours, five hours, six hours, however long they would let us demo for. And then we'd sell through them, and then the next time we went to Spokane, you know We would rent a sprinter van and we'd fill it and eventually we were driving twenty five foot box trucks there back. Where were you keeping all the inventory? Like at your house. In the gar like in the garage box. Like in the basement in In very flimsy boxes that you know came from China. Yeah, but you probably had to keep it cool. Yes. But this was this is was Seattle. So it was. Yeah.

41:59 Okay, you've got the packages you're going into mom and pop stores. And how are they doing? I mean, you're sampling them, are they Are you getting reorders? Are they selling? Oh yeah. I mean, first of all, we believed that demoing was really important because it's food. We wanted people to try the food. So, you know. We would go in, it would either be four of us or two of us. And we would demo

42:22 Five or six, sometimes seven nights a w you know. Nights a week, sometimes double demos. And in in a single demo we could easily sell You know? Forty bags, fifty bags. So You were seeing these store managers go, Wow, like you know, he s sold through

42:40 you know, four or five boxes in a few hours. And then we would start to get, you know Mm. slightly bigger purchase orders, you know, instead of buying two boxes, they would want ten. And we eventually put our, you know, our small flimsy boxes into quote master cases and we started delivering bigger cases to the store. So it was very organic in that way. Alright, so you guys are doing

43:03 mainly mom and pop stores. But I think you also uh whole foods in Seattle at some point. At this point. Chrissy was our co-founder was leading the charge there. Every morning she would take off at pretty much the crack of dawn with a backpack full of samples, and she would go sit in a Whole Foods.

43:24 You know, where oftentimes they would tell you manager's not available and she would just wait. I mean, we're talking, you know, one whole foods at a time, one mom and pop at a time. Uh, you know, uh actually Google, the Google campus in Seattle was probably one of our first big accounts and Chrissy s snuck into their Cafeteria found the chef and convinced him to bring the product in Uh and offer it to their employees. And r sort of reading between the lines, it sounds like

43:53 This is when At least the two of you, maybe the four of you, start to talk about we gotta raise money if we're gonna do something, if we're gonna make this bigger. Is that is that more or less what happened? Aaron Powell I think that's true because I think it was reaching an unsustainable place in terms of You know, obviously no one was being paid. Everyone was living Uh

44:13 My home. At the time. Uh You know, I think we had to look for an alternative then. And so yes, it was clear that we needed to raise some money.

44:23 Okay. I think if I'm not going to be a good th originally looking for a million, a little bit over a million. And one of the people this is just g I'd love to hear the story, who invest in the seed round. is this guy Rohan Oza, who was who's been on Shark Tank and

44:41 Yeah, he helps I think the vitamin water, poppy. I mean this guy is kinda legendary and beverage and and and other products. How did you encounter him? Yeah, this was a complete chance moment.

44:56 Uh right after I'd moved to Seattle to do this full time, I would still go back to New York every once in a while. I had friends there. It's still where a lot of my social life was. And so one night I was just out at a bar and I got to talking to this guy. He was asking, you know, what I was interested in and everything. And I said, Oh, I've started, I'm starting this business. We're gonna be the next pop chips. Oh, by the way, do you want me, do you wanna try my nuts? And he was like, absolutely. So I give him this, you know, probably half melted bag of, you know, our dipped almonds and he said, Wow, this is a really good product. This is really amazing product development. What's your plan? You know, and I was like So f I you know, I had so much um

45:40 Confidence. I was like, we're gonna build a a big brand, uh, you know, we're gonna disrupt the industry. I had no idea. who this was. I just thought this was like a random person who I could get feedback from because we were passing these out to anyone we really could. And he was like, you know, what are you doing about money? I was like, Oh, we're gonna raise a a friends and family round. We're gonna raise a hundred thousand dollars. And he said I think you're gonna need a lot more money than that. And so He ended up giving me his contact. I still had no idea who he was. Uh I went back and you know and researched it. And at the time, you know, he was

46:21 A huge part of vitamin water, pop chips, and so that Led to a kind of early m a very early mentorship with Rohan. And

46:35 At that time we were raising, you know, we were gonna set out to raise this friends and family round. We had brought a little bit of money in, and actually one of our very first investors was Bill Nye. Thank you, Bill Nye. You uh you gave us some seed money, despite his financial advisor, I think at the time telling him it was a terrible idea. And uh and so we'd raised I don't know, I wanna say maybe Six. And it was big for us, you know? It meant that we could continue to make

47:02 product and sell product and Rohan came in on that very first seed run. I Yeah. If memory serves, I think you put a a hundred and fifty, a hundred and sixty thousand dollars into the into the business. And that really kind of like started to make things feel

47:20 Real? One of the earliest things he said to us is he said what makes a brand successful is Comes down to three things. Product.

47:30 And he's like, you have the product. Have the people and the you know, this is a real founder led brand. Let's work on the package. Yeah, I mean the name skinny dipped also is interesting. I mean there was skinny girl vodka or b cocktails and still around. I mean so and and I wonder if it's also a way

47:49 Um which I think is smart to appeal to You know, maybe m again, originally you were thinking about what do we like to eat? What are you know, snacks we like? Was there Thinking like this could also appeal to women being called skinny dips. Um I think we were really careful about that. We didn't want to look at skinny in any sort of Pejorative way.

48:10 We want women to feel great about their bodies and we were never ever Intending to imply You know. Uh I had two daughters. I raised two daughters.

48:23 I wanted my daughters to feel good about themselves because they were strong and uh resilient and intelligent and not because they were skinny. So I have to say for me there was a little bit of trepidation. Using that term correct because I knew it could be m maybe misunderstood. It's a double edged sword. It's there's an attraction to it.

48:48 that you're sort of pointing out. I mean I love the name because of what I love about the name skinny diped almonds is it is the product. You know, that's and we still to this day in in in our products are always aiming for this balance, this thin coating. Um so it's very it's a a very literal name. I also love the idea of skinny dipping. I do it myself.

49:13 Yeah. There's a double meaning there, right. It's it's naked baby, basically. But it's wild and free and like you know, it's got some cheekiness to it. Okay, so now you've got some money that you've raised and clearly and and a and st in a three products still it's it's basically Uh the chocolate dipped almonds that are rolled in raspberry and in salt or in espresso.

49:38 Powder, is that right? Correct. So we were very focused on those three for the first few years. And Uh you know, after we'd spent call it, you know, a year, year and a half maybe selling in kind of all these regional stores and smaller places, we We caught the attention of target and Yeah. How did you how did that happen? Yeah. Was it a trade show? Did you guys go to a trade show? No, we had a we actually got Introduced to

50:05 A broker. Um Who was from one of our kind of early mentors, we got this introduction to a broker who specialized in target. So even though it felt Early in many ways. Uh

50:18 This broker at the time Loved our product and he felt like we should present it to the target buyer to see what they thought. So we did. We flew out, you know, this was in the day of where you got to go sit with your buyers in person, right? So We flew out to Minneapolis and we sat with this buyer and we sampled our product and we talked about our brand.

50:40 shared our story and then we went away, we went back home and uh and the broker who was helping us at the time said, you know, listen, I think I feel good about this. I think we might get, you know, a hundred store test, a two hundred store test. And Up fr and so he gave us a call and he said, Okay, you know, she wants to have another meeting. So we flew back to Minneapolis, we sat in front of this buyer, uh and her name was Tanya. She gave us Thank you, Donny,'cause it was she really gave us a chance. And She looked at us and she said, I absolutely love your product. And she said, Do you have any supply chain issues? And I just looked her dead in the eye and said.

51:23 Nope. And meanwhile We were still in the coop producing very, very small batches. And she said, Okay then, well I'm gonna bring all of your flavors in. Mm.

51:35 Chain wide In three months. So eighteen wide is how many stores? Wow. Yeah. And so I'm pretty sure I was like, you know, immediately clammy, sweating. It was a mix of, you know, fear and excitement all at once. And we really couldn't believe it, right? Because

51:55 In my minds, we'd set the high bar at a hundred stores or a hundred and fifty test stores. And I mean we didn't even have a distributor. We didn't have a co-packer. We did not have a co manufacturer. We were packaging in Spokane. We were producing a Nuts in the coop. And we had three months and it was the holiday season. We didn't even know how we would get this to target, let alone make it. So you've three months to get enough product and I mean I can't imagine how many pounds of this stuff you have to make.

52:26 So what do you d I mean, you've got some cash, you've raised about five a little over five million dollars, so You've got some cash, which is great'cause you're not you're gonna need the cash to finance this. Uh, where what do you do? Where do you go? We We made a lot of

52:43 tracks really quickly. We reached out to a co man in Seattle. That was actually a confectioner. Uh You know, Co Man. Um

52:54 I Doing big quantities of the Doing big enough quantities of things. Yep. And we uh And so we yeah, we started working with them.

53:06 And they had the capacity to do the thin coating they have those giant like cement mixture machines. They did, and we had to To essentially convince them and teach them how to do that, but they were amenable to that. But uh it all didn't go quite as planned. Mm.

53:22 the guy who was sort of their head guy, um, who was sort of my contact. I'd been, you know, out on the floor, coming back into their little office and he he brought some finished out to me and he said I don't think they Taste quite right. And I said Okay.

53:41 And I started tasting them, and he was absolutely accurate. Something Was wrong. And something was really wrong. And I was able to identify what the problem was, which that was that our nuts were rancid.

53:57 And you cannot make a rancid nut. Tastes good. So there we were. We were sitting there with forty thousand pounds of rancid nuts. And three days. To produce package ship.

54:11 But um We had one mission. Target was our our opportunity to to have a f a selling story. So that we could then go to Kroger, we could then go to whomever and say, Hey We've done this in Target. Um

54:28 So this was gonna be our our our selling story. This was our Big opportunity and uh Rohan had been Hell bent on making sure forgive me, but he kept repeating one mantra which is

54:43 Don't fuck this up. Well we come back in just a moment. How Breezy and Val overcome the crisis of the rancid nuts. but soon face something even worse. They're spending much more.

54:57 than they're bringing in. Stay with us, I'm Guy Roz, and you're listening to how I built this. Hey, welcome back to How I Built This. I'm Guy Raz. So it's 2017 and Breezy and Val are racing to fulfill their first big order from Target when they hit a snag. Forty thousand pounds of rancid almonds. All I could think was

55:34 I I I I literally was paralyzed. So I called Breezy, who was on a plane. To temper. And or I guess you were just off the plane. You had just stepped off the plane. And I was I s I sat in paralysis, not knowing what to do. We landed and mom just kept calling my phone over and over again and I pick up and I was like, What's going on? And she's like, We have a crisis, an absolute crisis. And she explained what was going on.

56:04 I got off the plane, went to the same podium, you know, when you step off boarding and do planing, and I just said Is this plane going back to Seattle? And they said Yep. And he said, How do I get on it? I don't care what seat where I have to sit, I'll sit in the bathroom. I just need to go back. And they were very nice. I got loaded back onto the plane, flew back, went straight to Our manufacturer which actually kinda close to the airport. I will

56:31 I will never forget the image of my mom sitting there. I walk into this kind of Dark conference room. And she's sitting at the table with like hundreds of nuts that she's bitten in half. And

56:44 This pale look on her face. And she just said, Th there's nothing we can do. They're rancid. Immediately I started calling the supplier. I was like We need a new shipment. They're like the earliest we can get it to you is, you know, whatever it was, ten days, a week and a half. We would have missed our window. I

57:03 I called everyone I could think of to say, you know, what other suppliers are there, you know? I Begged. Anything we could do. And w honestly We just kept hitting roadblock after roadblock. We got to the point where we started to do the math on going We're just gonna have to go buy these from the grocery store. We're going to have to create an army of friends and family who all go to the grocery store and just essentially deplete the bulk bins. And how many can we get? How many can we get from Costco? Whatever we had to do. And it was

57:35 And and so Eventually I reached out to somebody or I got connected to somebody who had been kind of in the nut world and he's like, I think I may be able to pull in a get a favor here and get you a truckload. And

57:52 He came through. We got a truckload. And we were in fact able to produce for Target, but uh Just barely, honestly, just barely.

58:03 Wow. So the thing about Target also is that it is It it it it sounds amazing, right, from from I think most people listening, like wow, amazing your set. But It's a huge risk because if you do this and then your stuff doesn't sell, you're done. You're kind of out. And you're not gonna get another chance. Right. I mean so so that's ri a risk. Like you could put this product in target as good as it is.

58:27 And it would it might not sell, right? Because what what tends to sell, like end caps and things with massive promotional dollars behind them. And so what were you able to do to make sure that they would sell. We were aware that it was a big risk. So we had been told by so many people, you should just say no to them. Like you're exactly what you're saying. You're gonna you're going to fail. You have exactly zero percent brand awareness and There's no way you can be successful at this and Obviously, you know, the usual way of entering a retailer like target, right? Is that you have these segment of test stores where you go to see if the product will turn and sell. And we were going from zero to sixty. And so we had you know someone say to us like

59:12 You should at least try to get an end cap. That way you'll get more visibility when you launch. So we went back to Tanya and we essentially Said. Is there any way anything that we can do to To get an N cap. You know, and she said, Do you have

59:27 Any other flavors that could be exclusive to Target? And we said We literally just developed A peanut butter almond. Peanut butter it's like a double coated in dark chocolate, coated in peanut butter. We can give you that.

59:41 If you will give us an egg cap, and she agreed. And I think that. The N Cap really helped us initially. So you mean it exclusive to target? We did. Initially.

59:53 'Cause an NCAAs you have to pay a lot for. To be honest. I'm sure we did pay for it, but because we had no idea what was going on financially in our business, we weren't tracking deductions at the time or all of this. We were just surviving. It was super messy. We were just like, This is an opportunity. How do we how do we make sure that we just absolutely we do everything we can to be successful and target. And

1:00:16 That worked. Clearly it worked. So That's a a major test that you then You you not just survive, but it it It works. I mean, they're selling there.

1:00:26 Yeah, I mean that was really a springboard for us in so many ways. It had forced us to Kind of This accelerated, you know. Uh not just growth but like growing up period. And we had

1:00:40 Proven that we could you know that The mass market. Loved our product. Yes. You know, clearly we were we were

1:00:49 beginning to um accelerate and there was you know kind of an amplification of the brand. So in addition to the co man we worked with uh right around the time that Target came into our lives. Um This guy's name is Jeremy. Jeremy was also building out his facility. We really birthed the product with Jeremy. So we were s you know, we were in the facility all the time.

1:01:17 And t today do you work with multiple co manufacturers or do you only work with one? Multiple. And what about the margins on a on a product like this? I mean, are they pretty good? I mean, people I think are more willing to spend more on almonds'cause they're used to spending more on almonds. Uh So we have quite a

1:01:38 colourful gross margin history, which is that our brand was, you know, born in this time when Everything was about growth, right? Like growth at all costs. Just grow, grow. Don't worry about profit, just grow. Exactly. No one had even asked about our margins or you know Profitability, forget about it. No one was considering that. And then, you know, you have to remember that we didn't even have a finance background. I mean originally we were doing our finance on like, you know, sticky notes and you know, I didn't had no idea what cogs were. I didn't even know what gross margin was.

1:02:12 So at a certain point Um, you know, we the c business had seen a tremendous amount of growth, right? We're available and probably at the time. twenty thousand plus retail retail doors, right? We were losing money. We're still because were you underpricing? No, we weren't underpricing. We just We were focused on growth, we were focused on brand, and we really had not put our focus on, you know, what are our growth

1:02:38 margins. Are they sustainable? Are they healthy? And we had gross margins in the teens. We hadn't focused on it. We didn't have the expertise or the know how and It wasn't until the end of twenty twenty two when Essentially the funding dried up, right? Like we were gonna raise another round of funding. It wasn't available and

1:02:59 Everyone told us you are never gonna be able to take a business that has Gross margins in the teens. And make it profitable. This is really cr critical, right? Because you twenty twenty two you couldn't raise money. And and this is the thing I think a lot of

1:03:13 businesses don't realize is that You know, you might be doing extremely I think in twenty nineteen you guys were already on the Forbes like or Inc. five thousand list. You're number thirty two on this list for the fastest growing business in America. I mean six thousand percent growth you know, revenues growth so on paper it looks like you guys are j everything you got everything figured out, right? And and but

1:03:37 In twenty twenty two, you have a hard time raising money. Which is w which is a lot of businesses did. I think some of the jeopardy is that you go so fast and if you are founders Who Are not

1:03:51 grounded, say, in finance. You may not understand that it's really critical. To know something about cogs. It's really, really important that you find another source for your carmel powder other than Britney in France. And I don't think I think we were so fixated on certainly speaking for myself on developing a

1:04:14 That you know. But kind of blew it out of the water in terms of flavor. That we just Didn't have the discipline. Or the know how.

1:04:23 to kind of um hold ourselves to Um some of the limit limitations. Yeah. And And that was a big challenge because we did not want to impact the flavor of our products. I mean it reminds me a little bit, Breezy, of your time selling sorbet, right?

1:04:40 Right. Because you were just going to public's or whatever and buying the best stuff you could'cause you want it to taste great. But You know, naturally, this is what we all want to do. But we don't always think about well, am I Actually with the labor costs paying for everything, is it all get is it is the retail price paying for all this stuff?

1:04:58 Well, and I mean listen, we had we didn't have a leaky bucket. We had a bucket with big holes in it. And we had to figure out You know, ship was going down and we had to figure out what to do and we had to do it quickly and It came from the You know.

1:05:15 uh the supply chain and finding domestic sources for things that were coming internationally that were just as delicious. It came from picking up every single one of our you know warehouse like essentially where we are warehousing product, finding more efficient places in the country to put it. It fr It was working with all our retailers and moving them from delivered to FOB, it was there was a time when I mean When I tell you we did not have money in twenty twenty two, We I asked our entire like leadership team to put their salaries on hold just so that we could try to make payroll for the rest of the company. Wait, I so so that's amazing, right? Because on again, on the from the outside, you're just crushing it. You're all these stores, you're in Costco

1:05:56 I mean you were trying Costco I know Costco was uh eventually y you guys figure it out. But I mean you've got celebrities coming at you wanting to invest, like This is a hot Brand and and was any part of you worried like we might not make it? Like we might have to sell this business for like pennies in the dollar.

1:06:15 There was a moment where We hit absolute rock bottom. It was in November of twenty twenty two. I think it was the first time in the history of the brand when I remember I was in New York trying to raise money and I just absolutely lost it, just sobbing in my teeny tiny shoebox hotel room. My husband got on the plane and flew out to come support me and I just thought

1:06:38 I don't know what to do now. Like this is We are in a hard place. It was the first time I had ever had that feeling, and then somebody said to me She said. She said, I have never met.

1:06:52 An entrepreneur who was ultimately successful that did not hit rock bottom. And this is your rock bottom. And you're right, we had a brand w a lot of things were working for us, you know? We had retailers picking us up. We had we knew that we had, you know, our consumers loved us. We had all of these things from the outside that looked great. But we had a sinking ship behind the scenes with our financial situation. And so we We had two options. It was either You know, like when people say a soft landing it's like the worst words. It was either find a soft landing Or

1:07:28 Okay. Your finances to match what you have built. from the outside looking in. And that is what we decided to do. How did you how did you do'cause again, I'm sure people are like, breezy, Pow, you guys I it's amazing and what you've built and go wow, you and people are assuming you guys are rolling in cash and you're freaking out. How did you and you can't raise money,'cause I know you would eventually raise money, but it would be not until t September of twenty twenty three.

1:07:56 And again, this is a tough time. Twenty twenty two Tough year to raise money. Very hard. Can I just mention here too that we had a grown up in the room We had hired and and he had been with us for several years by this time, Mark Mortimer, who is our president. And I do think that, you know, arm in arm with Breezy and our

1:08:16 our CFO. There was a concerted effort to address every aspect of the business to be ruthless. And to figure out how to get out of the pickle that we were in. And not only that, Mark came in with some some added capital at a time, you know, just to at least make payroll. He made a personal investment to help to support the brand. But like we d when I tell you ruthless cutting, we cut every single single thing that we cut to bone, essentially, is the way I think about it.

1:08:49 Everything. I mean we starting from top to bottom, even in our trade spending, we cut every bit of trade that we feel like wouldn't put us in jeopardy of losing an account. We cut Every single bit of marketing that was costing us anything. I mean, we had no money. Zero money. We reformulated our chocolates. We reformulated our peanut butter cup feelings. We reformulated We reformulated anything we could put hand you know our hands on. We We found new chocolate suppliers. I m we just dug deep. And the one thing that

1:09:22 We try to protect. was the team. So we knew that We had worked really hard. to build an amazing team and I think we felt like

1:09:34 there's one thing we are going to protect, let's try to keep our team intact so that we can go do the work that needs to be done to get our gross margins where they need to be. We did that and We did that over the next year and a half. How much money do you think do you estimate you saved? Were you cut?

1:09:52 Like millions? Yes. And at that time. I was also working to raise money. But when I tell you working to raise money, I mean I talk to hundreds of people.

1:10:03 No one was deploying capital, you know. And so I had to find a solution. And we ended up finding an amazing partnership and it was a really important piece of like kind of the next chapter of our story. And we partnered with David Gretman.

1:10:18 Who had been friend of mine from my Miami days who had gone off, and while we were building Skinny Dipped, he had built a really well known and successful hospitality business in Miami and We raised a round from all of these celebrity investors that like genuinely loved the brand. I think I just had this like Feeling.

1:10:43 Deep down that This was it. If we could overcome this obstacle, then we would be there and or we would be on the other side. And uh and I have to say, like when I raise that money That was not

1:10:57 A you know, that was not a syndicated fund. That was individually from each celebrity investor. 65 individual celebrity investors. One at a time, multiple calls with each. I mean, you know, and that's a lot of time. It's yeah, and but they have been great advocates for the brand and David, for us was, as I said, he has been a believer because he believed in us in a time when he could see, he could see that we had built this brand that people loved and we had products that people loved. And I convinced him that. All we needed was a little time to get our finances to match. The brand.

1:11:32 Yeah. And I know I I read that In twenty twenty four you've you become profitable. for the first time, which is normal I mean Right. It it often takes ten years for businesses. But but now

1:11:44 I imagine and as you describe Reezy like that became like an absolute obsession for you. Oh is it You know, it's a game changer for us. Uh that being said, I do think that there's a balance between growth and profitability. And I think, you know, the pendulum used to be too far one way, right? Which was grow at all costs. But then it swung the other way. And then what happens is You can't it's too hard for a challenger brand to break through because it is expensive to go into CPG. You have to fund inventory, you have to you know, you're doing something different and pay slotting fees, all kinds of things. So I I'm a believer that Like I think it would be very difficult to be profitable from the start. I think you just, you know, at a certain point it is important to know that you can get there.

1:12:33 And I mean, for us it was a game changer. It means that now we have the funds to be able to invest more heavily in marketing. Uh, it means that we can invest in our philanthropic program, which has been something that my mom and I had wanted to start from the very beginning, and it took us ten years to get there. So it's certainly uh I It's definitely a little more relaxing to be profitable. Yeah, I bet. You know, um I mean now you are

1:13:02 In I think over twenty five thousand stores. Um Breezy, you're the CEO. Yes. And Val, what's your official title?

1:13:11 I had up our innovation. And you're very much involved in this business. I mean it's do you do you consider Ten years old or eleven years old? Like what do you guys Think. when you think about how l how how long you've been doing this.

1:13:24 Yeah, I think of it as a decade. Yeah. And you know, people say to us all the time, Oh my gosh, you know, you've grown it's like an overnight success. And I always will remember this interview that I saw with Daniel, the founder of Kind, and he said exactly the same thing. People would go to him and be like, overnight success. And he's like, It took a decade to get here. It took a decade, you know? This didn't come overnight. It's been We have had our fair share of up and downs, um, but yeah, so I I think of it as a a healthy decade. And and look, Val, I mean you were I think I said late forties and it doesn't matter, but I think you were in your early fifties when this started, right? You're you're my age and and and here you are

1:14:04 A very youthful you know, sixty something. Um to uh but like that's awesome. Like when you were fifty years old you would not have known that by the you know, by the by time you're in your mid sixties, you're gonna be running up.

1:14:18 a business is doing a hundred million plus a year. Yeah, totally. I I mean I had none of that vision. And when I was forty years old, you know, I would have like fallen over backwards if I'd looked into my crystal ball and seen myself standing in a hairnet. Next to my daughter who was also in a hairnet. With a tray of nuts. I mean, really? Yeah.

1:14:40 People will ask us sometimes what What kind of or will ask me, what kind of advice Would you give an entrepreneur and and Part of it is holding the course. It doesn't mean that you don't

1:14:52 you know, make some compass shifts or or you know, you don't tack from time to time. But holding the course and to do it with my daughter. has been, you know, the great honor of my life and not only with her, but with our two other co founders who are also like daughters to me. So Well and your other daughter's also in the my other daughter, and you know the you know, here I am at the ripe old age of sixty six. Uh shocking. And I used to think, wow, there's so many father and son businesses, but you so rarely hear about a mother-daughter business.

1:15:30 And uh I think Part of me wanted to set out to change that. You know, to be a part of a successful mother daughter business. Yeah. Um

1:15:41 I I I mean it's it is so cool that Val, I mean I just I I c keep coming back to you as a parent because I just I just think it's so cool that you Trusted Your child's vision and instincts. And

1:15:54 And you You know, it so uh to me it sounds like you really let Breezy lead this thing. That you You know, you were not sort of making assumptions about your experience and your wisdom or you know, it was like, Okay, let her let kinda let her lead it and I'm I'm there for the ride. Yeah, totally. Yeah. I mean

1:16:12 That was a leap of faith. Yeah, wasn't it? Mine at the time that the business started Effectively or at least conceptually. I mean we were paying her f her cell phone bill. You know.

1:16:23 And this this was not like at that time, you know, a kid, a young woman who had like an incredible amount of financial savviness. So it was a leap of faith, but it became clear very, very quickly. that she was absolutely the one destined to lead the company. That is not my skill set. But I was just saying like

1:16:44 Yes, I think that part of what I bring to the business is You know. This kind of unlimited jet fuel, right? Sometimes there's a cost to that and my mom's an amazing counter to that too. But

1:16:57 What my mom has brought is She's a visionary of the business and has been from the beginning. She has an ability to See long term consumer trends coming before they're here. And so I really think it's been that combination of

1:17:13 Jet fuel meets visionary that has been you know, part of why we've been successful. Yeah. When you think about Uh about

1:17:23 where you got to now, ten years on more. And You've got a great product and brand and people know it and it's visible as a Starbucks and and here you are, h over a hundred million dollars in sales. How much of this do you attribute to the work in the grind you put in and how much do you think it had to do with just luck that, you know, people wanted skinny almonds and and chocolate covered almonds. They wanted these products now and it was just the right time and place. I would tell you ninety eight percent hard work and two percent luck. Yeah. I mean seriously, and you use the word grind, which is which is what it is. It is a grind. It is relentless amount of hard work.

1:18:02 And not to say it's not fun and all of that, but it is a lot of hard work. That grind that we were talking about was not just about us. That grind was our co founders, Lizzy and Chrissy. So much of this is, you know, when one was down or two were down There was somebody else to to stand up and and be a cheerleader.

1:18:26 You know, and that's been I think incredibly important. And I'm a very peaceful person by nature, but when people say to me, Wow, you guys have been so lucky. I can feel my vi the violent side of my personality want wanting to emerge. We yeah we've absolutely had some serendipitous moments and some, you know, some important breaks along the way. But um yeah, it's it it has been a hard earned ten years. But it's a labor of love, right? You keep doing it because you love the people you're working with.

1:19:01 Again, then that circle extends to this little mighty team that we've been lucky enough to have surrounding us for the past number of years. That's Val and Breezy Griffith, co-founders of Skinny Dipped. By the way, their website has some pretty good advice in case the chocolate almonds melt on their way to you. You just take the bag, you smash it. Put it in the freezer, wait for about a half hour, and

1:19:27 Boom. Instant chocolate nut bark. Hey, thanks for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show. And if you're interested in insights, ideas, and lessons from some of the world's greatest entrepreneurs, sign up for my newsletter at guyros.com or on Substack. This episode was produced by Carrie Thompson with music composed by Ramteen Arab Louis. It was edited by Neva Grant with research help from Chris Massini.

1:19:56 Our engineers were Robert Rodriguez and Quacy Lee. Our production staff also includes Alex Chung, Andrea Bruce, Casey Herman, JC Howard, Sam Paulsen, Catherine Cypher, Ramel Wood, and Elaine Coates. I'm Guy Roz, and you've been listening to how I built this, and don't stop the podcast just yet. Пиказ района you're about to hear an amazing small business story that you don't want to miss. This segment is presented by American Express.

1:20:23 With a business platinum membership? The best just got even better. This week's story starts in 2009 when artist Ryan Burkhardt left his job at a nonprofit screen printing press to try and start his own printing business. I was kind of adrift for a few years trying to figure out how I was gonna rebuild something from scratch. Ryan felt like an impostor because he didn't have a traditional background in business.

1:20:49 I had no plan B, my expectation was that I would be an academic. And he kept having the same thought. If he was gonna start a company in his adopted hometown of Austin, Texas, he needed to start building relationships with other entrepreneurs. So he joined a local co-op meant for screen printers, where he met Bruiden. One of us took a job printing something we didn't know how to print. and went to the other one and said, Hey. I got this job and it's due very soon and I don't know how to do it. Would you help me?

1:21:20 The two of them took on a few gigs together. and found that their skill sets complemented each other pretty well. It was just like so obvious that we were going in the same direction. We thought well let's

1:21:33 Let's go together. So Ryan became a co-owner of the company that Bruce had recently launched, Kong Screen Printing and Design. And in the beginning, it was a pretty bare bones operation. we were printing everything on a manual press, meaning No mechanics. you loaded the screen onto the press.

1:21:52 You pulled the squeegee by hand. You did everything by hand. For the first couple of years, they weren't making much money. But then in 2013, right before Southwest, Kong screen printing got a special t-shirt order. There's kind of a trope in our city that everybody comes to South by Southwest for a week or two, and then they move here the following week. And there is some resentment within the community and we were approached to design shirts that basically says, welcome to Austin, please don't move here.

1:22:25 The shirt they wound up printing became a huge hit, locally and nationally. GQ picked up the shirt and published it in an article about how to look like a local when you're going to South by Southwest. And there was so much demand that Kong screen printing could hardly keep up. Well, we learned an awful lot about fulfillment and mailing and shipping really fast. It went crazy and we were totally unprepared for it. So they hired some help and bought an automatic printing press with more colors. Buying this press was really a marker for us at Kong because it allowed us to do a lot more for our customers. and it also allowed us to gain a lot of efficiency in production.

1:23:07 Today, about 15 years into their business, Ryan and Bruce have printed designs for local restaurants, businesses, and nonprofits, but also for big brands like Coca-Cola and Topo Chico. Their business is now bringing in roughly$3 million annually. But unlike bigger printing facilities, which might have multiple shifts and run all day, they've made a more intentional choice. We keep it 830 to 530 Monday through Friday. We both have families and we really want to have a rich quality of life.

1:23:41 As for that shirt that put them on the map all those years ago, I still see it out around Austin from time to time. People still ask us about it, and I find that kind of amazing. That's Ryan Burkhart, co-owner of Kong Screen Printing and Design. His small business story is presented by American Express. To build a business like no other, you need a card like no other. There's nothing like business platinum.

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