Advice Line with Christina Tosi of Milk Bar

Transcript from https://podmenti.com/t/7dd23152ac946c26


Hello and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on the show.
who will help me try to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Leave us a one minute message that tells about your business and the issues or questions that you'd like help with.
Alright, let's get to it.
Joining me this week is Milk Bar founder Christina Tosi. Christina
Great to have you back on the show. Welcome back.
Uh guy, I missed you. I know you too. I mean you were on the show back in 2019. It was a live show. It was so fun. I remember that show. We it was like jammed. People were cheering, they were so excited to see you. Um if anyone listening has missed that episode, uh go back and listen. We'll drop a link to it in the show notes. Uh so check it out. Um basic story
Milk Bar started in two thousand eight. Um Christina had opened up the first milk bar where they popularized she popularized cereal milk
Ice cream.
Compost cookies.
the now famous milk bar pie, which is insane.
Uh fast forward to today
Their cookies and treats and ice creams are available.
uh thousands of retailers, Whole Foods and Sprouts and Walmart and their
So good. Uh Christina the brown butter
Chocolate chip, the super crunch mini cookies are so insane. They've completely messed up my I'm gonna no not do sugar, but a little bit of sugar, didn't he?
But I can't I eat the whole bag. That's a problem. I just I'm like I just look at it. We're texture hounds, you know? It's so they're so good. Um I know you stepped down as CEO of Milk Bar a couple years ago to focus on
on the creative side of the business, which is I think probably the most interesting, the funnest part of the business, and I
urge everybody to do that. True. Um, can you can you give us a quick update on what you've been up to these days and and a little bit about your role at Milk Bar?
I mean, guy, when I think about the time we got to spend in person in twenty nineteen, like we had no idea that night
That
The way that we walk through the world would change so dramatically a year from then, let alone we're what, five, six years from from then now, seven years almost. Um
A a few years ago, I had two babies during I got bored, and I like to say Will and I got bored and we started having babies. We got a giant dog and named her Butter, and
Um, then when it was time to kinda go back in to work in the office, we moved everyone
Back into New York City and we thought
A lot of this does not work for us anymore. And one of my big things was
Um
Because the
Milk bar business had been so stress tested through these last years since we spoke.
I really had to
Take a few
A step forward and backwards and to each side and sort of say
Where am I best?
suited here. Like I'm every bit as passionate. My tank is
full with fuel, but I can't just keep driving down the same road at the you know the same speed limit with the same map. It's all changed. And my biggest thing was
I am short changing the milk bar business.
holding on to the CEO seat.
I would much rather focus on what I'm
specifically and uniquely positioned to do, which is like
The creative, the culinary, right? Like no one's taste buds.
Are my taste buds or your taste buds? And so now I'm sitting in Nashville, Tennessee, which is where we moved about a year ago. I'm sitting in a garage where I do all my baking. What you can't see off camera is all of the different messy baking experiments.
I have in my head that might make it to the milk bar menu at some point. I just feel more alive and firing on all cylinders than ever. So That's so awesome. Um and I can't wait to see that kitchen all all your
the tubs of like ingredients. I could just imagine them perfectly lining the counters and like Yeah, I s I sometimes I when I when I use like odd ingredients like milk powder for for cooking, I think of you.'Cause it's something you don't use every day. Like to you toast it and then you how you use it and anyway.
Chewy brown buttery notes. I my favorite thing about you is that most people don't realize is that you are a baker and a foodie, among many other things. I wouldn't I gosh, baker, I wish. I wish I love cooking. I love cooking. You're talking about toasted milk powder, my friend, you are a baker in my book.
Um I'm curious, I mean from a business perspective, right? I mean you you have the th there are so many different things that you do, right?
cookbooks and and and T V shows that you host and and but
But from the
milk bar side, right? There's there's the direct sales, the the the tins and the cakes and the milk bar pie. But also, as I mentioned, you can go into Whole Foods or Walmart or Sprouts and buy
milk bar products off the shelf. What
Where do you guys see like
the most potential for for growth? Is it
Is it
having more products on the shelves
in big retailers? Is it
direct to consumer
It's so interesting, you know.
We've intentionally
Built.
Are
brand in a way that's much bigger and broader than what you know the top line revenue of our PL is. Yes.
Because that's the challenge. It's the challenge for our sales channels to try and catch the size and reach of the brand. So
I would say that our biggest opportunity is to continue to find ways to show up in unexpected places. We just did a crispy cream collab that launched yesterday. And
d like is that bringing money to our bottom line pennies, right? Like it's not about that. It's it is getting to share like
the the milk bar spirit with people all across America. And for us, what's economically savvy about it is it's free earned brand and media as opposed to needing your sales channels to drive a revenue.
That brings enough money to like the e but du line that you can invest in it from a marketing standpoint. Cause at this point, if you're not running a profitable business in twenty twenty six. Right.
I don't know, like you know, where that was different in twenty nineteen. So Yeah, I think that's such an important insight because
A lot of founders, right? And people who who run brands.
don't always want to do the collaborations. They don't always want to focus on the the the brand sort of building side of it uh because it feels like a waste of time.
You know, and and you don't n necessarily see the return. Right. You can't measure it. And
But it opens you up. It sort of creates the
Foundation.
those places where where you can find the products and and and the ideas that
Will connect in.
because people already know and trust the brand. And I think that's really
Important'cause a lot of people, a lot of brands, I mean, I've been on on this side of it too, with some of the things I do, don't wanna do the slow and sometimes hard and sometimes not so satisfying things like
stand, you know, in front of a coffee shop all day or whole foods or whatever it might be.
Yes. It that's
That's it in a nutshell, guy.
All right, Christina, um we should probably bring in some callers. Are you ready to take our first call?
I can't.
Collar, welcome to the device line.
You are on with the founder of Milk Bar, Christina Tosi. Please uh tell us your name, where you're calling from, and just a little bit about your business.
Hello, Guy, hello, Christina. I'm so excited to be here.
My name is Whitney and I'm calling in from Park City, Utah. My business is the Bow Collective, and we are a fitness and retail hub where locals can sweat.
shop and stay connected. Wow. Okay. Well welcome to the show. Thanks for calling in when you are you so the
The Bow Collective as in
B E A U, like my Bo. Okay. So it's a fitness studio and
A retail space. So explain like you walk in and what is what does that look like? Yes, it's kind of like a a mullet, really. You walk in, it's a retail party up front.
And then fitness classes operate in the back. So when classes before they begin and as the after they're finished, we
Have space to dwell.
And we let people connect and shop and have coffee and s hang at the social table.
Uh before they leave.
Got it. Okay. So and and what do you sell in this shop? I mean um is it mostly like workout gear and and sure? It's full scale all the goods that we love, um, from Lululemon, Marine Lair and things like that, where I've always just wanted to be able to shop before ten AM and we're open
at six AM when people are finishing their work out. It's all apparel, Whitney.
It's apparel and gifts and home goods and brands and and things that we've loved and we've curated.
over the last decade. Okay, and give me and the classes are like they began hit style, always 45 minutes. And then we've kind of evolved into more heavy lifting, uh more hybrid setups and things like that as well. But everybody can count on a 45 minute
high spirited experience every time they're in. All right, awesome. Tell us a little bit about the revenue. Like how much comes from memberships or people going to classes, how much from the retail shop.
Yeah. It's about at this point it's a f fifty five percent from the fitness, forty five percent from the retail. And and either of those growing more or less, you seeing trends in either direction?
We're actually seeing the retail as an uptick. Interesting. So I think convenience and delight and fun where people can
purchase things and a lot of these brands can showcase what they do to all of these people where they already are. Got it.
And this is a sh this is one location in Park City is
Just give us a quick sense of the ambition here. Is it is it a park city business? You wanna just
Or or or what? Yes. So the ambition and the plan right now we're expanding and to my hometown in Phoenix. And I really do believe especially, you know, it's fitness and retail, but it's really community.
and connection that we're selling. And
I really see that every town needs something like this. It's not a bar or restaurant, but it's hospitality in a healthy form. And it's getting people to move together to pick up some goods that you don't have to run out in all of the traffic you can grab at sunrise, and is really just a reimagined way.
For people to connect that's um that's good for them. Got it. Okay, before we d dive in further, uh what's your question for us?
We've run this business for 10 years in Park City. It's profitable. It's doing great. So my question is in um the finance world of this, we're in that.
Sweet spot.
uh just north of friends and family fundraising and just you know below anything institutional. So my question is about bridge capital, when we're really trying to secure that, how do you really align with people that understand what you're building?
Got it. And and this is you're raising money to open the location Phoenix. Yes. Okay, got it. And so you've raised some and it just roughly how much have you raised from friends and family?
Friends and family, we've raised about six hundred thousand. Okay, and you need uh closer to a million to open this up? We need about two hundred thousand more. Okay, got it. All right. Um I wanna bring Christina in. Um
Just launch into it, Christina. Welcome to you, Whitney. I am so excited for you, Whitney. Just really quickly, will you give me like what is the like
average order value or whatever acronym you use in place of AOV for
a customer, whether they're buying from the retail or the fitness. Yes. Retail average ticket is between sixty and eighty five and then two hundred dollar memberships monthly.
We have about two hundred members.
I got an idea there for you. Okay, I'm coming back to that. And then what about day parts, night parts? Like are people coming in and buying in retail at six a.m. Or does that happen during a certain consolidated time of day? Sure. A typical day is we open the doors at six a.m. classes run from six to ten a.
All of those people call it eighty a hundred
participants and members, they're able to shop.
At any point. And then when classes end, the location is in a center. So we just open as a shop and behind the shiplap wall.
Um is just vacant until the classes start again. So
And is your vision that you continue to build Bo Collective and own and operate it?
yourself as a as a private company.
I I think we would establish guardians in different markets and cities that have been trained through us that where we own it at at a corporate level, but then we have great local people that care so much about the communities that we we grow them that way. I mean my
My first thought in like fun the fundraising, like the niss of your question, right? Like how do I
complete this sort of like two hundred K
Bridge round. One of my first thoughts
Whitney
as you were talking about this new community that you're going into, the power of community, the collective
200K is a lot of money and not a lot of money, depending on who you're talking to on the fundraising rank. One of my thoughts is why not pre-sell some of your memberships, right? Like knowing what the cost of a membership is.
How do you pre-sell the access to this really cool collective and community? What could that look like? I think that could be really interesting. I also wrote down, as you said, Park City, like let's think about what works in Park City, right? Or what Park City is. It's a pretty affluent area. I immediately
thought, oh my gosh, Arizona, is it gonna be in Paradise Valley? What about Aspen? What about Jackson Hole? Like people that have
the finances to both want to spend on the retail level, create have maybe a little bit more free time, create community, and then also want to care for their own health and well being, like
What does that look like? Cause one of my questions, how is this, how is this new market going to support you? How do you know how much you need? That's always the question when you're opening.
A new unit? Is this market the right fit? And then the other thing I'd really inspire in you to do is
If you don't already have the space, like
really get in there with landlords because there's a lot of vacant
Spaces.
all across America and you can get really great landlord terms. You can get them to pay for your TI, which stands for tenant improvements. A lot of them will build out a space for you, deliver the electric you need, the plumbing, et cetera, et cetera. There is a way that you might not even need 200K or maybe you need less than that.
And really bring the landlord in because it sounds like whoever the landlord is, this
Bo Collective is an amenity to them, whether it's to the other tenants on the right or the left, or if it's, you know, mixed use and there's commercial or residential above. Like there could be some wheeling and dealing there as you're modeling.
Oh collective.
Yeah, I I think it's it's interesting because you have uh and I was thinking about uh you mentioned some of these other places, right? Paradise Valley, and I was I I look at you know, I'm looking at photos of the boat collected and think of like Kilauea and Kawaii, you know, some one of these really cool places where you've got a bunch of affluent people. And I wonder whether
You might want to consider something a little radical.
Um ripped out of the playbook of uh there's a a bagel chain here in in in California, small chain called Boy Chick Bagels, it got a lot of press in the New York Times a few years ago. When they expanded outside of Berkeley and Southern California,
they actually offered a chance for their customers to have some equity.
You know, uh and small checks.
And maybe it's like
a bunch of checks for a thousand bucks. I mean I'm not saying that's easy, but you know, could you get two hundred people or uh or even smaller checks or some might write five thousand and and maybe it's again, it's like a convertible note a loan and they get
a ten percent discount card which they can use in Phoenix or in
Uh Park City and and they're a member of the club. You know, it's like they're not just a
They're an investor, but they're an insider.
I mean it
If you've got passionate people are going there, it might be worth literally putting up a flyer and saying, Would you be interested in
investing in our expansion and
You know, it could could be it could be an interesting way to raise money.
I think you're right, in the spirit of our people, we really are kind of like the tailgators, the people that, you know, went to college and some days miss it a little bit, right? It's it's a co-ed vibe of people that just root for each other. They're such great people that really turning it into even just on a small scale that they could have a piece of it.
Could be really fun. Yeah. By the way, Whitney, like what guy is talking about, if you think about it, like how do people choose like where they're going to work out or shop? I don't know about you, but for me it's like proximity, right? The easiest so like how do you canvase the area closest to your new Phoenix Bow collective with word of mouth.
Maybe you're part of, you know
other local business owners and shops where you're putting up these physical flyers or digital flyers.
On top of that, you get these people to buy in. Girl, you don't even have to be stressed out about marketing when you open, right? Because you already have two hundred or four hundred new customers spreading the words. That are excited to come in. And what I'd also say to you, Whitney, is a few things. One
One person's opinion.
You wanna take institutional capital as late in the game as possible, if not wait forever, right? Like
Challenge yourself to never take it. There's a lot of great things that come from institutional capital, but you're on the record, right? Like they believe in you and your vision and your dream, but there is a lot of extra work in terms of reporting and strategy and board level things that also.
Take you away from the founder entrepreneurial visionary spirit.
And there are so many clever creative ways in
nowadays than ever before, to not have to go too that well. I think a lot of times as early on entrepreneurs, I know I was that way.
thinking that's a sign that I've made it, right? When I'm able to raise money and leverage that money and and but there's so much else that comes with it. So
Unlocking this yourself is going to give you the future power of choice on so many different levels while also training your entrepreneurial brain to be smart and savvy and gritty in all the ways that you are going to need for
All of the years of Beau Collective to come.
I totally agree. Um Whitney, it's congrats on on building this. Good luck in Phoenix. The the company's called the Bo Collective. If you're in Phoenix, look out for it. Uh Whitney Kozlowski, uh thanks so much for calling. Thank you. Thank you so much for sharing. Yeah.
Yeah, I mean I I'm now I'm on the website, I'm like, Yeah, the brands are cool, the clothes are cool, it's like a nice curated space.
And uh yeah, I mean the site is awesome. Should we quit our day jobs? I wanna both go work for Whitney. Like do you wanna work out and then have a cookie? I will be your chief of staff, babe. Let's go.
We're gonna take a quick break, but when we come back, another caller, another question, and another round of advice. I'm Guy Roz, and we're answering your questions right here on the advice line on how I built this lab.
Welcome back to the advice line on how I built this lab.
I'm Guy Roz, and my guest today is Christina Tosti, the founder of Milk Bar, and we're taking your calls and let's bring in our next caller.
Ooh, I can't wait.
Hi Guy and Christina, I'm Chloe and I'm calling from Leicestershire in the UK, and I'm the founder of Cotton Clara. We make beginner-friendly craft kits that are designed to help people discover crafting and making and hopefully find a hobby that they love.
Welcome to the show. Um thank you for for calling in, uh Chloe. So
Leicestershire is Midlands, right?
Yeah, right in the middle. Yeah.
Leicester, Nottingham, kinda Birmingham. Birmingham, okay, cool. There we are.
Awesome. Thank you for calling in. Thanks for listening to the show. So tell us a little bit about Cotton Clara. You sell
Uh like craft kit.
And like w describe them.
So um
They're designed to be beginner friendly. I kind of
saw this market, you know, ten years ago and it felt so old fashioned and I
I felt like there was a gap for design led, modern
Kits that appeal to people that have a kind of
Oh.
Design conscious and want something
Beautiful in their home.
And what can you get like you make I mean, is it uh is it like embroidery or sewing? Like what are the things that you the
that you make. So depending on the kit, so you either create a kind of a little work of art that is framed in an in the hoop that you stitch it in and then you put it on your wall.
Um or we one of our really popular kits is a friendship bracelet making kit. Oh nice. Um we have papercraft kit, um, all different types of things. We have a flower press kit, so it depends which kind of craft you choose.
Awesome. And you said you started this ten years ago, about ten years ago?
Yeah, I mean the the seed of an idea was ten years ago, but really the business got serious in
Twenty twenty, kind of end of twenty nineteen, twenty twenty.
And you sell everything direct to consumer, or do you also sell into stores?
It's about sixty percent direct to consumer and about forty percent wholesale, but wholesale is really growing at the moment, especially wholesale to the US.
Okay, and are most of your customers in the UK and Europe or also you mentioned wholesale to the US. Wh where are they coming from, your customers? Most of our wholesale customers are in the US, but most of our D to C customers at the moment are in the UK. And where do you sell in the US, by the way?
We sell to Barnes and Noble, Anthropology, um, and then loads of kind of shop.

independent small or maybe small in America, but in the UK. They're huge. And and give us a sense of what of of your annual sales. Like what what what do you expect to hit this year or Yeah, this year we've just had our best year yet. We turned over one point two million dollars this year or last year. So that was our huge milestone. And
Before we dive in further, uh which question?
So our question is um
Our business serves three different markets. So gifting, craft enthusiasts, like your classic crafter, and then the kind of wellness movement.
And we're not sure which positioning will best drive the scale we need to build a truly profitable business. So we'd love advice on how to identify the audience most likely to buy repeatedly and how that should shape our product development and our route to market.
Alright, so so
Gifters, crafters, wellness. Yeah. Uh okay, who do you
Where do you go to? Okay, Christina Christina Tosi, I want to bring you in. Um
Crafting, cool business, uh over a million dollars in sales now. Awesome.
She's doing great.
But
There's some d choices and decisions to make. It is so true. I mean, Chloe, first off, congratulations, one point two million, that's huge. Second of all, I want everything on your I'm a crafter. I was raised by
Women, the gran the granny spirit is alive and well in me. It's definitely how I was raised in all of the free time we crafted, craft kits did not exist, so you had to like raid grandma's basement for you know, for thread and for old pieces of fabric, the fabric store, the yard sales, that sort of stuff.
I also think it's a really interesting moment where you're at where
But to your point, like that the business really started taking off in 2020, right? Like that shows like a a macro trend, but an interesting one because
I see your business as crafting, acknowledging that gifting and wellness are ways that crafting
finds its way into people's lives that aren't just thinking about crafting first and foremost.
Well, also at least in the US, what we're seeing, we're seeing a lot of like there's a reason Etsy took off.
But there's also reason why
craft stores like the big box Michaels, um Joanne, a lot of those crafting first
stores
Have suffered.
on just like a brick and mortar real estate basis. But also when you look at our other big boxes like a Target or a Walmart, they're doubling and tripling down into this crafty spirit. There's you're onto something. You're on to an activity that we picked up in the pandemic that we haven't lost, right? That we're continuing to find
really, really dynamic stickiness with joyful stickiness with. Um, as a baker, I'm a believer that
The act
Activities where we get to create and bring things to life, whether we're being serious about it or not being serious about it.
Are activities that are going to continue to be really powerful for us in an age that continues to be increasingly digital. Right? We feel like that. Like the potential is massive and huge. Yeah for the for kind of this industry. What do you like where what do you want to do with with cotton clear?
Is it is it international expansion? Is it um
How are you thinking about that? I appreciate the like, what are we?
But I am curious to sort of like what do you want to be?
Yeah. We wanna be a a big global brand. We wanna get people making all over the world. Uh but I I want to be
A brand that
does that in a sustainable way. So um yeah, we're we're dreaming really big. Got it. Yeah Okay, here's some thoughts that I have for you, Clo. Um
I wonder if, and this is something my husband and I my husband's also an entrepreneur, this is a game we play at home all the time.
when we're faced with a challenge of like, is it this, is it this, is it this, we force ourselves to create one additional option. So when I hear you say are we gifting, are we crafting, are we wellness, I go, What if you're none of those things, what would you be?
And if I had to force myself to come up with another word.
It's it's makers, right? Like you're what is the what's the why? What is the stickiness? I think it's because people are making something like
Um, when we are
at a crossroads at Milk Bar, and we're trying to figure out
Is this the right product, or is that the right product? Is this the right language? What's going to be sticky? We go to our community first. And knowing that you have a 60% DTC customer base, pull them. Yeah. They may have some of the answers. They may give you some texture that helps give you direction. And then the other thing that I
think could just be cool.
I have a friend named Elisa. She's actually a a neighbor of guys in San Francisco on the West Coast. She fell in love with baking, and for her, baking is about like community.
Um, she started doing this thing a few years ago called Cake Picnic. Oh, and she has gotten sponsors and now she through these things and people come together in a park one day.
And they eat cake together. It's literally a party.
As an excuse to eat cake. Yes. And people m make make these beautiful, elaborate cakes. They do do it at Golden Bee Park. It's
Incredible.
So part of me is like what is the like what is the makers picnic where people come and cross stitch together or friendship bring I mean, girl, I'm a friendship bracelet wearing theme over here. Like you need the idea of making, crafting, whatever it is, to get out much further beyond
growing your business. I believe that's gonna be a secret to your
global domination success and getting us excited about
Beanmakers.
All right, Chloe.
Take it for where it's worth, but I
I have a slightly different
perspective which is
I actually think that your customer
is the repeat customer.
Like it doesn't matter if they're a gifter and they're buying or if it's I think craft enthusiasts probably is the most challenging because they are
probably often looking for the l best value or lowest price. Let's say not even best value.
But it's like
So and I think the wellness
thing is really interesting, right? I don't think it's a trend. People aren't, you know, they're f looking for ways to find fulfillment, spiritual meaning and for better or worse. It's a
massive exploding industry.
when you consider everything that fits inside of it. So I mean I think that
You know, you wanna start looking to see who's buying your stuff more than once, who's buying it four or five times a year. What is it about them.
maybe contact them or or see if they will talk to you f in in exchange for a free product and just
download who they are, why they're buying it, what they like about it. Yeah because I think every decision you make
Whether it's a marketing campaign or social media or whatever you can put into that.
It should all answer that question. How do we
get people to come back. How do we deepen the relationship with them? Wait, can I say one thing about the wellness thing? Because I like where you're going in it. My caveat or my sort of like asterisk that I'd say to it is
It is wellness, but it's inherently a joyful wellness pursuit, right? And so how do you think about
what the right word choice is because if you use wellness too closely, it's gonna feel like you're saying eat your vegetables and we assume they're gonna run in the other direction. Yes. So what is the like wordsmith of this look like as you're so you have a few different options when you go to talk to your repeat customers and and is it about unlocking creativity? Yes.
Are they creativity kits and not crafting kits, you know, et cetera, et cetera. I think that's a great idea. You don't want to say wellness, exactly. It's like you're you're h hitting people over the head with it. You want to talk about unlocking creativity or and you can also start to explore potential partnerships with
really big candle brands or you know products that are sort of wellness ish or adjacent that where you might have people interested in
doing some kind of cross promotion or cr or or collaboration. This g leads into this other idea, which could be
I mean, it takes some some energy, but could be worth it. Like a vertical, just a business vertical, a completely separate part of your business.
where you you start to work with brands, you know, brands that we've had on the show like Airbnb or
Canva milk bar. Can I get a milk bar crust? Yeah. I mean I mean I'm looking at some of your your um your designs here and they're cool, like little bento boxes and ramen and you could potentially, you know, Canva has a giant
staff like convention every year. Thousands and thousands of people from around the world. Like, could there be some kind of collaboration where you can stitch a Canva logo or uh you know, something like that, which could be an interesting
totally separate business. Yeah. No, that's great.
All amazing ideas and yeah, lots to think about.
Chloe, congrats on the business, Cotton Clara. Uh good luck. Thanks so much.
Thank you. Bye. Bye.
I I what the thing I love about
These catches that uh
You can be complete completely useless. Like I am really
I've you know, I've a lot of patience for cooking, but for some reason like
I just can't get my head around this, but I think'cause this is easier. This is like Yes.
She's got things where it's like paint by numbers. I could get into that.
Also a friendship bracelet. I mean I know your kids are like cusp.
Too old, but like
N I make friendship bracelets all the time. Like I bring embroidery thread in a little sewing kit on the plane with me,'cause it is just
It's something that I can make for someone else. It makes me feel good. It makes them feel good. It like
'Cause once you do it, guy, you'll you'll be hooked. You'll be like, I can't believe I made that I'm sure. Your friendship bracelet era is about to begin. Something tells me. It's about to begin.
All right, we're gonna take another quick break, but we'll be right back with one more collar.
Stay with us, I'm Guy Raz, and you're listening to the Vice Line right here on how I build this lab.
Welcome back to the device line on how I built this lab. I'm Guy Raz and today I'm taking calls with Milk Bar founder Christina Tosi. Uh so Christina, ready, ready for our next call?
Ooh, let's go.
All right, let's bring in our final caller. Welcome to the advice line. Tell us your name where you're calling from and uh just a little bit about your business.
My name is Christy Clement. I'm calling in from Washington State.
And I'm the founder of Vashon Island Coffee Dust. So we make spice blends to flavor your coffee without sweeteners. So there's no coffee in coffee dust, just real spices, cinnamon, cardamom, cayenne, things like that to add to your coffee. And it's a clean alternative to creamers and syrups. Or if you're a black coffee drinker, it's just a fun way to
Change it up in the morning. Oh awesome. Oh, welcome to the show, Christy. So these are
They're powders, but it's not they're not sweetened and it's not like um, you know, powderized milk. It's it's just spices that you add to the coffee.
Yeah, so the whole idea is they're blends. Some people already add some cinnamon or nutmeg to your coffee, right? And these are super fun blends. So we have a gingerbread blend. We have a couple of spicy ones, a hot mama and a spicy papa that have cayenne in them. And the hot mama, for example, is
Cocoa and a little bit of cinnamon, some cayenne, and some sea salt. That's it. Interesting. And does it I mean I'm curious because if you add that to coffee.
It doesn't
necessarily dissolve, right? I mean does it

like integrate with the coffee, do you really get those flavors? You really do. Yeah. So we get our spices ground extremely, extremely finely. And that helps to to dissolve in. I'll also hit it with a frother. So you can
Add it to your coffee after you've made it, just dust it on top. That's what most people do. You can also froth it with your milk. Or you can add it to your grounds, use a little bit more, but you can brew it with your whole pot.
How how long, uh when did you start this business?
About five years ago. This is this is a Covid baby. I used to be an IT consultant teaching software.
teams to act like startups. Um but I've never been in the food business.
And I was a new coffee drinker during COVID, filling as most new coffee drinkers do, their coffee full of junk, right? Cream and sugar and things like that. But
Uh a friend introduced me to spice blends adding to coffee.
And I was able to get off the cream and the sugar using that method. And I just fell in love with it. I started playing around with other flavors, and as work started picking back up.
uh at the end of the pandemic, I thought, all right, well, I don't have time for this. I'll just buy it from somebody because I was completely addicted at that point. But nobody made it and so I knew I had to start a business. All right, Vashon Island, that's the island in the
Puget sound, right? It's in Puget Sound right.
Yeah. Okay. So
Uh
You are selling these how? Where? Mostly through your website?
We have five different channels were on our website.
We we do a lot of in person markets.
We do et z.
We have a wholesale channel. We're in about fifty independent gift stores and coffee shops across the country, and we sell on Amazon.
Awesome. And um how how'd you guys do last year?
We did two hundred and seventy seven thousand in revenue.
And we've been profitable from day one. So again, we've been doubling our revenue.
Amazing. Okay. So so before we dive in, uh, what is your question?
So
I know many coffee dust customers discover us through gifting and then become loyal buyers for themselves. And that flywheel feels really powerful, but I'm not sure how to deliberately design for it.
Christina, I suspect you had a similar challenge with Milk Bar, and I'd love both of your thoughts on how I can intentionally create that.
gifting loyal buyer loop.
All right, Christina
Fashion Island coffee dust. Christy's looking for some uh you know, ideas on how to
Get those people coming back again again. Um Thoughts, ideas, questions?
You know, it's so first of all, Christy, congratulations.
Um one, I think it's a great concept, like people's
Drink ritual is truly that. It's sacred. It's a ritual and
I think because we all love food and flavor, like the sweet spot of what you're doing makes a lot of sense. You know, when we started Milk Bar, my um first of all, my goal was to like have a bakery and stay alive.
I did not anticipate being a gifting experience. I thought I was just selling a warm cornflake chocolate chip marshmallow cookie out of the oven or a slice of, you know.
Um, cake unfrosted on the sides, or little ding of soft serve and the DTC part of our business, we launched our care package business just so we could reach someone that was never gonna make it to our New York City bakery. But what we realized really quickly that was that it became a thing. Um, if it is gifting, you have to think first and foremost about
Of course the take rate, right? Who is
Who is gifting it and then how do they want it to appear as a gift? How do you make their job as the gift giver as big and brilliant as and easy as possible? So thinking about
You know, we chose a a literally it's shipping in the mail. It's insane to use a white box, right? It doesn't doesn't arrive in pristine white box order. But babe, in a sea of cardboard Amazon boxes, when that box arrives, that we have social media that's just people being like, Oh my gosh, I can see this white.

No script.
in a sea of cardboard, right? Like how does it show up in a way that gives someone that tingly joyful
Right. Like I love that. And I think it's the same thing. If gifting is your segment, really, really thinking about that. And there's gonna be some tension points, right? Between what is absolutely the most efficient and what is going to feel giftable and gift worthy. Then you're thinking about, okay, so how do I afford nicer packaging?
Can I bundle it with a frother? And then it's an even cooler experience, but I can actually charge more and afford for the nicer packaging because a frother doesn't actually cost that much money than when it's being gift. How is it showing up in someone's life? For us, it's usually like a high value occasion. It's someone's
birthday. It's someone's graduation. It's someone's wedding. For you, it might be a housewarming gift. This is gonna be, it's free marketing for you, girls like a Trojan horse, right? You get to be on their coffee counter. So what should that look like from a coffee counter standpoint? You don't see my coffee in my house because no one has figured out how to make
the coffee experience look pretty enough to sit on the shelf of my kitchen and so it gets tucked away in a cabinet. Is there something beautiful that's also efficient in the way that it is used that can enhance someone's coffee station? Like
Those little things I think are really important. I'm I'm look at me, I'm like in and so excited for you. Gonna try all these dust, but I'm also going, I drink coffee in the morning, but my evening tea.
I want the healthful cinnamon turmeric ginger nutmeg.
I want that in my tea at night. And so that's the other thing that I would just you didn't ask for this advice, but I'm gonna give it to you as a very impassioned consumer.
I have beverage rituals that extend beyond coffee, and I believe
that your dust could extend there too, and that could be an interesting way to expand and grow business while you think it's a good thing.
And we do tend to when we first explain it.
it's it's really about the coffee, but we do when we send it out.
send a little info sheet on what else you can use it in because it is other beverages, but it's also, you know, add a little cocoa column, which is cocoa and lavender, to your whipped cream and with some strawberries. It's amazing. I had a customer one time tell me they used captains on
Chicken as a dry rub, like blew my mind, right? It sounds like you have a fair amount of UGC user generated content, anecdotally or otherwise, right? Like, did you know you could use captains on your next chicken bake? You know, did you know you could
You know, add this to hot water and get an incredible tea. You can steep this in your hot chocolate, et cetera, et cetera. Like you can really test and learn.
what's sticky for your regular customers without it feeling so direct of like a repeat ploy, as opposed to giving them more reasons to come back because they hadn't thought about
using your product in a different way.
You know, I I was thinking about what you were saying, Christina, and I
I totally agree. Like I I because I'm looking at this product and I'm thinking, Okay
you know, you want to focus on like making it really easy and frictionless on how to use it. And you had mentioned, Christy, that you sprinkle it on on frost coffee or something, because I didn't think I just figured you'd you know people just mix into the coffee. So I initially I was like, well maybe
Maybe you should have a QR code with a video. Maybe you do that already when people get it. Like here's a video, here's me making it, here's how I love to do it. But actually
The frictionless side of this is
To think about
How do you make this so easy right? Like
Like a K cup, right? Ka y you don't I look this up. You don't need a license to make a K cup. They I guess the the patent or whatever expired.
Over ten years ago.
Anybody can make a K cup.
Shaped.
Where you just stick it in.
And that's it. You've got it. You've got all the flavors and the and the
Benefits, etc.
That's great. I love that. I mean it's not easy to do right away. And and and and sure, in the meantime, you know, you wanna figure out again how to
how to create repeat customers, right? Because you want people to use this
Every day. Yeah. Yeah.
Christy Clement of Ashen Island Coffee Dust. Thanks for calling in. Good luck.
Thank you guys so much. It was a pleasure. I appreciate it.
Yeah, thanks.
Um, Christina, you are like wow.
You're a business school professor'cause your practical advice is so good. You too. School of hard knocks right? Yeah. To run and grow a business over the last eighteen years, right? Like
You learn a lot about what you don't know, and then you learn to stay super duper curious and passionate about what you don't know. You know, truly.
Um, before I let you go, I wanna ask you one one final question, which is if you could go back eighteen years to you know, when in those early days when you built out milk bar.
Um, what would have been helpful for you to know back then that y that may have made it a little easier or better, or maybe not? I don't know.
You know, I've I'd spend a lot of my time these days reflecting, probably because I'm waiting for a batch of you know, cookies or cake, whatever it is.
To bake um
It's not the early day advice, believe it or not. It's probably like the year three, year four, year five, all the way to like maybe year ten.
Advice.
And
It's really simple. It's
You know what you know better than anyone else. Do not lose the way. As the founder, as the entrepreneur, you know what you know about your business better than anyone else. So stay open and curious, but do not
ever shortchange what you know. You may not have a business degree, right? You may not have all these other things that these other collaborative partners or mentors have, but I'll tell you the one thing you have that no one else has, and it's what you know to be true right here. Yeah. And I I
That's one thing I I I'm saying it to you because I remind myself of it every single day. Once I learned it, I thought, ooh.
I'm never gonna forget it.
Yeah.
Christina, thanks for coming back on the show.
Oh.
I had so much fun with you today.
Thanks for having me, Guy.
It's great having you. That's Christina Tosi, founder of Milk Bar and
By the way, if you haven't heard Christina's original How I Built This Episode, you've got to go back and check it out. Really great episode, super fun and funny.
And here's one of my favorite moments from that interview.
I just remember my blackberry kept buzzing and buzzing, and I was like, what is going on? Like, did the bakery catch fire? Is my family okay? What could this possibly be? And I had all these voicemails, and I have a vo I my favorite voicemail was from this woman in Kansas City who I think maybe was someone's grandma, and she was just like, Well, I heard, you know.
Anderson Cooper talk about this crackpot and I just I'm never gonna make it to New York. So like would you mind shipping me one? And it was like
Are you gonna tell her, are you gonna call her back and tell her no? Cause I was not gonna call her back and tell her no.
And we now have an online business where you can email us and
Daddy's like, when opportunity knocks, what are you gonna say? Like
Not today.
When it's time to rise to the occasion, you rise.
Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at guy.com or on Substack.
And of course, if you are working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues that you're currently facing, because we would love to try and help you solve them. You can call us at 1-800-433-1250.
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This episode was produced by JC Howard, music composed by Ramteen Arabui. It was edited by John Isabella. Our audio engineer was Jimmy Keeley.
Our production team also includes Alex Chung, Carla Esteves, Casey Herman, Elaine Coates, Chris Massini, Katherine Cypher, Carrie Thompson, Sam Paulson, and Neva Grant. I'm Guy Raz, and you've been listening to the advice line.
on how I built this lab.