Perfect Snacks: Bill and Leigh Keith - How I Built This with Guy Raz

Transcript

Guy Raz (0:00)

Wondery subscribers can listen to How I Built this early and ad free right now. Join Wondery in the Wondery app or on Apple Podcasts. Thank you to our sponsor, American Express. Being a business owner means you are in control of your destiny and you get to be your own boss. With Amex Business Platinum you can get a flexible spending limit that adapts with your business. Not all purchases will be approved. Plus you can earn 1.5 times Membership Rewards points on select business purchases. Points cap applies. That's the powerful backing of American Express. Terms apply. Learn more@americanexpress.com AmExBusiness so here's something pretty cool to think about. Have you ever been lying in bed at night at an Airbnb? Maybe scrolling through your phone when you realize, wait a minute, could I do this too? That was the question Giovanni asked about his house in Florence, Italy. And guess what? I got to stay in that magical palazzo for a few nights because it was on Airbnb. Find out how much your place is worth@airbnb.com host how I built this is supported by Ring. With Ring, you can be there from anywhere with doorbells and cameras that help you see more to exciting features that help you know more to the app that lets you connect more. See more at the front door, up high and down low with battery doorbell's head to toe video capture it all all day and all night and get smarter alerts that know the difference between a person and a package right in the Ring app. I use Ring to check in on my dog when I'm out of the house or running errands just to make sure everything's okay. It's awesome because I can see her wherever she's in the house. With Ring, you can check in and be there from anywhere. Some features require a subscription and are available only on select Ring devices. Exclusions apply. Learn more@ring.com during what I guess was a routine kind of testing of your dough or your batter, you find a possible sign of contamination. A microbe, salmonella and something like that can kill your business, right? So what happened?

Bill Keith (2:18)

Our own test on ourselves came back with a positive microbe.

Lee Keith (2:23)

And Costco, major retailers, they do recall everything. They don't want to take any risks, which is totally understandable. So I'm calling folks that I have spent years, you know, a decade of creating trust with and telling them that this product needs to be returned and it's crushing. And so we're just thinking, gosh, this could shut down things permanently. I remember not wanting to go to Sleep, because you have to wake up the next day and go through it all again.

Guy Raz (3:00)

Welcome to How I Built this, a show about innovators, entrepreneurs, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on the show today, how a family rescues itself from financial ruin by selling hand rolled energy bars, which eventually wind up in every major grocery in the country. I'm going to let you in on a little secret about this show. Even though it's an audio program, I actually want you to experience it visually, almost like a movie in your head. And oftentimes the stories on this show are so implausible, so against the odds, crazy, that indeed they sound like fiction. Maybe you heard the episode a few years back with the McBride sisters, how the sisters only discovered the existence of each other after their father died and then connected and started a wine brand. That story was incredible and so is today's. And make no mistake, you will learn business lessons in this one for sure. In fact, you will hear how Bill and Lee Keith, brother and sister, turned their dad's homemade energy snack into a big business, Perfect Bars, a business now owned by the multinational company Mondelez. Bill and Lee grew up with 10 brothers and sisters. They were raised in the 1980s and 90s, traveling around the western United States, mostly in a school bus, which they also sometimes lived in. Their dad, Bud Keith, was a small time health and fitness guru who was also a deeply committed Christian. He was a complicated man who struggled financially and it's fair to say the kids grew up in conditions most people would describe as poverty. But Bud also emphasized health and nutrition at home. Before Bill and Lee came along, Bud ran a gym on Mission beach in San Diego and at one time worked with fitness pioneer Jack LaLanne.

Summary

Podcast Summary: "Perfect Snacks: Bill and Leigh Keith"

Introduction In the June 9, 2025 episode of How I Built This with Guy Raz, host Guy Raz delves into the inspiring journey of Bill and Lee Keith, siblings who transformed their father's homemade energy bars into a thriving business, Perfect Snacks. This detailed narrative explores their tumultuous upbringing, entrepreneurial spirit, significant milestones, and the challenges they overcame to achieve success.

1. Early Life and Family Dynamics (00:00 - 06:15)

Bill and Lee Keith grew up in a large family environment, navigating financial instability and frequent relocations across the western United States. Raised primarily in a school bus, the siblings experienced a nomadic lifestyle imposed by their father, Bud Keith—a health and fitness enthusiast with a strong Christian faith.

Key Points:

Large Family: Raised with ten siblings, Bill was born in 1982, and Lee in 1985, in a household marked by movement and financial hardship.
Father's Influence: Bud Keith operated a gym in San Diego and emphasized health, nutrition, and spirituality, albeit struggling financially.
Unconventional Education: Formal schooling was limited; the siblings learned to read and educated themselves at home, particularly through the Bible and practical life experiences.

Notable Quote:

Bill Keith [05:09]: "Our own test on ourselves came back with a positive microbe."
Lee Keith [05:24]: "And Costco, major retailers, they do recall everything. They don't want to take any risks, which is totally understandable."

2. The Birth of Perfect Snacks (06:15 - 15:34)

Amidst growing responsibilities, Bill and Lee tapped into their father's homemade energy bar recipe. Combining peanut butter, honey, and his nutritional supplement powders, they created a palatable and nutritious snack that became the foundation of their entrepreneurial venture.

Key Points:

Recipe Origin: Bud Keith's supplement powders were transformed into tasty energy bars to make them more appealing to children.
Initial Sales Efforts: At ages 13 and 9 respectively, Bill and Lee began selling these bars door-to-door, targeting gyms and health enthusiasts.
Fundraising Motive: Sales were often motivated by specific financial goals, such as raising money for family trips.

Notable Quote:

Bill Keith [14:21]: "We were allowed to have one of those little balls every day. And that was getting our five tablets that we were supposed to Have."

3. Moving to Willow Creek and Expanding Efforts (15:34 - 27:38)

Facing mounting financial pressures due to their father's declining health, Bill and Lee relocated to Willow Creek, an isolated town, to support the family by managing an abandoned motel and ramping up the production and sales of their energy bars.

Key Points:

Relocation: Moved to Willow Creek to live off the grid and take on various odd jobs to sustain the family.
Motel Purchase: Acquired a 130-year-old motel with the hope of generating steady income.
Family Responsibilities: With their father suffering from severe skin cancer, the siblings bore the brunt of maintaining the household and supporting younger siblings.

Notable Quote:

Lee Keith [20:00]: "We were just thinking, gosh, this could shut down things permanently."
Bill Keith [20:13]: "We call the FDA. I remember like just that feeling that, just sick to your stomach, stomach, call the FDA on yourself."

4. Securing a Breakthrough with Whole Foods (27:38 - 43:35)

Determined to save their family business, Bill and Lee secured a test placement at Whole Foods. Through relentless demos and personal sales strategies, they managed to generate significant sales, laying the groundwork for broader distribution.

Key Points:

Whole Foods Test: Successfully conducted a 30-day product test, resulting in $30,000 in sales.
Sales Tactics: Emphasized in-store demos to directly engage with customers and gather immediate feedback.
Scaling Challenges: Faced production limitations due to hand-rolling the bars, leading to inconsistent product sizes and packaging.

Notable Quote:

Lee Keith [39:23]: "We were trying to sell them in gyms and we would sell them in like, oh, co ops, actually festivals as well."
Bill Keith [43:35]: "They allowed us to demo Sunup to Sundown, I think, just to kind of prove that that team leader had a good idea."

5. Overcoming the Salmonella Crisis (72:16 - 75:24)

In Christmas week 2014, a routine product test revealed potential salmonella contamination, threatening to derail their burgeoning business. Faced with a recall and FDA inspections, the siblings navigated this crisis with resilience and support from their investors.

Key Points:

Contamination Scare: Positive microbe test prompted an immediate and comprehensive recall of products.
Regulatory Scrutiny: FDA inspectors, armed and rigorous, shut down their kitchen pending further tests.
Investor Support: VMG Partners stepped in, providing crucial financial backing without penalizing the company for the setback.

Notable Quote:

Bill Keith [73:16]: "We don't know, still to this day, we don't know."
Lee Keith [74:25]: "They did not. To their credit, they did not penalize their offer at all."

6. Scaling Through Investment and Rebranding (75:24 - 87:23)

With the infusion of $10 million from VMG Partners, Bill and Lee undertook a significant rebranding effort, improving packaging and expanding distribution channels to include major retailers like Starbucks. This period marked substantial growth, propelled by strategic decisions and external expertise.

Key Points:

Investment: Secured $10 million from VMG Partners, allowing for accelerated growth and professionalization.
Rebranding: Invested $85,000 into a new branding strategy, focusing on protein and superfoods, resulting in a 40% sales lift.
Expansion: Entered new markets, including Starbucks, enhancing national presence and brand recognition.
Operational Growth: Transitioned from hand-rolling bars to semi-automated production, scaling from 7 million to 20 million bars annually.

Notable Quote:

Lee Keith [84:10]: "Success comes where preparation meets opportunity."
Bill Keith [85:00]: "We're still those homeschool kids... as a sponge and putting ourselves, you know, we're smart enough to know what we don't know."

7. Acquisition by Mondelez and Family Reflections (87:23 - End)

By 2018, Perfect Snacks achieved $70 million in sales and was acquired by multinational company Mondelez. The acquisition was executed with careful consideration to preserve family dynamics and the brand's integrity. Post-acquisition, Bill exited the company, while Lee continued to lead as Chief of Brand.

Key Points:

Acquisition: Sold to Mondelez, ensuring the family's continued involvement and preservation of the brand's values.
Family Harmony: Established a trust to manage financial distributions, minimizing potential conflicts among 12 siblings.
Personal Growth: Lee overcame significant health challenges, emphasizing the importance of balancing personal well-being with business responsibilities.
Legacy: The siblings reflect on their journey, attributing success to a blend of hard work, timing, opportunity, and familial support.

Notable Quote:

Bill Keith [89:14]: "I would have to say it's a combination of both... hard work and determination."
Lee Keith [89:52]: "We reached a point in this natural industry to where the timing was right to accept this kind of product."

Conclusion

Bill and Lee Keith's story is a testament to resilience, adaptability, and the power of family collaboration in overcoming adversity. From their unconventional upbringing to building a multi-million-dollar business, their journey encapsulates the essence of entrepreneurial spirit. Their ability to navigate crises, seize opportunities, and maintain family harmony provides invaluable lessons for aspiring entrepreneurs.

Final Thoughts:

Lee Keith [89:54]: "Success comes where preparation meets opportunity."
Bill Keith [90:34]: "We pair that with hard work and determination. Just really amazing things have happened."

Post-Episode Reflections

After the acquisition, Bill founded Green Fat, a nutritional supplements company, while other siblings pursued diverse careers, including education, environmental non-profits, and international projects. The family's legacy continues through their individual and collective endeavors, highlighting the enduring impact of their entrepreneurial journey.

This episode of How I Built This underscores the intersection of personal hardship and entrepreneurial triumph, illustrating how determination, family bonds, and strategic partnerships can transform challenges into monumental success.