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"The Do’s and Don’ts of Brand & Startup Growth Ft. Chomps’ Founders Pete Maldonado & Rashid Ali
00:46:31
#801: Join us as we sit down with Pete Maldonado & Rashid Ali – the Founders & CEO’s of Chomps. Established in 2012, Chomps was created to fill a gap in the market for high-quality protein snacks. Today, it’s recognized as the...
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- [00:00]
Lauren Everts
The following podcast is a Dear Media Production.
- [00:05]
Michael Bostick
She's a lifestyle blogger extraordinaire.
- [00:08]
Pete Maldonado
Fantastic.
- [00:09]
Michael Bostick
And he's a serial entrepreneur, a very smart cookie. And now, Lauren Everts and Michael Bostick are bringing you along for the ride.
- [00:16]
Rashid Ali
Get ready for some major realness.
- [00:18]
Michael Bostick
Welcome to the Skinny Confidential. Him and her. Hello, everybody. Welcome back to the Skinny Confidential, him and her show. Today we have two incredible entrepreneurs, co CEOs and co founders Pete Maldonado and Rashid Ali of Champs Chomps happens to be one of the fastest growing food brands in the United States. These two bootstrapped the business themselves and then went on to do phenomenal things, making it, like I said, one of the fastest selling foods in market. Lauren and I have been eating chomps for years now, and we had to get these two founders on the show to talk about how they did this. This is a real story of grit, perseverance and ingenuity breaking into a category that has already established. And I love it because I know so many of the listeners of this show are aspiring entreprene entrepreneurs, marketers, people that are looking to build their own brands, their own business. There are a ton of gems in this episode, and these two are a wealth of knowledge. What they have done with this brand is nothing less than stellar. So even if you're thinking about going into a different category, if you're an aspiring entrepreneur or business owner, or even if you work within a company that's looking to grow like they have, there is something in this episode for you, Lauren. And I love talking to founders, entrepreneurs, CEOs about what they do to make their businesses successful. And this one has it all with that Pete. Rashid, welcome to the Skinny Confidential. Him and her show. This is the Skinny Confidential.
- [01:40]
Lauren Everts
Him and her.
- [01:42]
Rashid Ali
So let's get the lay of the land with both of you. Let's go back. How. How did this even become a light bulb moment idea.
- [01:50]
Lauren Everts
Yeah, so I'll probably kick that off. So I was a personal trainer in college, and so I grew up in the Hamptons and right outside the Hamptons. And I had these clients that lived in Manhattan. They would come out to their Hampton Homes and they would meet with me and I would spend too much time. By the way, this is over 20 years ago. And so I'd spend too much time putting together, you know, meal plans and grocery lists. And back then they're like, like, it was like Jenny Craig. It was nutrisystem for meal plans. Now they're a dime a dozen. You could get a meal, meal plan, delivery program Anyway, what I would find is they would, they would leave and go back to Manhattan and they would get off and jump off the meal plan. They would never stick to it. And it made life really difficult for me because my clients weren't seeing the results that I really thought they should, you know. So the wheel started turning. It was like, what can I bring to market to make their lives easier? And so I've had a list of other businesses that I've started. Frozen food company. And all of them kind of led up to chomps.
- [02:46]
Michael Bostick
So when you say list of other, were these just different companies that you were trying to see which one would take off? And so you've always been entrepreneurial?
- [02:53]
Lauren Everts
Yeah.
- [02:53]
Pete Maldonado
Yeah.
- [02:54]
Michael Bostick
Okay. And what do you think the main reason some of those other ones didn't take off compared to this one?
- [02:59]
Lauren Everts
Timing. I made a lot of stupid mistakes, like early entrepreneurial mistakes, like trying to get things perfected before bringing it to market. That's probably one of the big things, actually. I spent too much time like a website, like I wanted to have every bell and whistle and spent way too much money. Never got to a fully functional website before we actually shut the company down. I think one other thing is raising money from the wrong person. That was. I was a real estate guy in Naples and it was just, it was like pulling teeth trying to get more money from him or to actually just, you know, he just didn't get it. So doing things differently this time, it was like, we're gonna make sure this is a fully sustainable company. It's self funded, we can grow on our own profits. And so that was one of the main things we did early on.
- [03:44]
Pete Maldonado
But it's interesting though because your first company was the frozen fitness company. Like when you think about the ability to scale and go to market. When we first, when he first started the company, it was originally to create a grass fed beef option to like Omaha Steaks. So that was the original premise. And we did that for, let's say six months. But we realized without raising money, you can't really scale a business when it costs that much to ship. It's expensive to ship frozen. And so we did that for a bit. Our moms were like our best customers. It wasn't really getting off the ground. And that's where one of the partner we were working with had a refrigerated, a multipack that was kind of like the early day charms. And that's where we pivoted to shelf stable and try to figure out like, how do we create something that's more scalable and perfect for E commerce.
- [04:30]
Michael Bostick
So how did you two get connected and start working together on this? Because it sounds like there was not a prior business together.
- [04:37]
Pete Maldonado
Some college buddies, wives, knew Pete's wife, and we were at, I think it was like a birthday party. It was like a poker game. And me and his wife actually made it. We're the last two people in this poker tournament. And she hates when I tell it, but I'm gonna tell it. Cause she loves this podcast and she's gonna hear it. But at one point, she looked over and she's like, rasheed, I'm gonna throw you down the stairs if you beat me. And I ended up winning. And then after the game, me and Pete were just sitting there talking.
- [05:04]
Michael Bostick
Did she throw you down the stairs?
- [05:05]
Pete Maldonado
She didn't. She didn't. She wasn't.
- [05:07]
Lauren Everts
But she's gonna. When she hears this. She's listening. I guarantee she's listening.
- [05:10]
Pete Maldonado
It was an empty threat. But Pete and I were chatting. And, you know, my background is I did management strategy consulting. I was always like a quant guy, very good at numbers, I. Operations. Like, I could really find value in. In data. If you give me a data set, I could figure it out.
- [05:24]
Rashid Ali
Oh, you're so important to a business, it's hard to find you.
- [05:27]
Pete Maldonado
Well, but. But Pete is the complete opposite, right? He's kind of like, at the end of the day, like, I'm not the. I'm not the creative ideation guy, the big visionary. But, like, if you give me something, I can tinker it to make it work and figure out, like, how do you make it scalable? How do you make it profitable? And so Pete and I were chatting, and all the stuff that he hated or wasn't good at, I was pretty strong and vice versa. And so that's. We just got talking, and then the next day, like, I think he texted me or I text him, and I was like, hey, you know, you're doing this steak thing. Would you ever want help? And we literally met my. My wife, she's an attorney. She drafted some partnership agreement, and that's how it got started.
- [06:02]
Rashid Ali
What was the first iteration of the stick?
- [06:05]
Lauren Everts
So we were initially doing it was eight sticks in a pack, like a single pack. And it had to be refrigerated. So when we were doing that, like, the Omaha Steaks type thing, that same processor was able to make sticks, but he wasn't making them shelf stable, so they had to be refrigerated. But I already created the. I already had that Chomps name. I was created on like a word art. The first logo is terrible. And so. But the people we kept hearing, they were like, we love these. Chomps are the best of the best. And so we're like, we got to figure out how to scale that. We need to make it shelf stable so we can ship it. And then we just, you know. And single serve was also important, so.
- [06:40]
Rashid Ali
And how many years ago is this? Because I like to give the audience who's listening a very digestible timeline of what it takes to become this. I think, like, I. People will look at you and be like, you guys made it overnight. Give us the real sort of timeline here.
- [06:57]
Pete Maldonado
We just celebrated our 12th year.
- [06:59]
Rashid Ali
Yeah.
- [07:00]
Pete Maldonado
So it's been a grind, and that's through E commerce. For the first four years of business, we didn't do any retail. We landed in 2016, Trader Joe's, which is one of the best retail partners as far as their ability to select product. They know how to price merchandise and deliver it. So we were with Trader Joe's for two years before we leaned into others. So, like, we were very deliberate about the growth strategy.
- [07:24]
Rashid Ali
Amazon.
- [07:26]
Pete Maldonado
Amazon was. Yeah. Early days too, so. Early days, yeah, it was just choms.com Amazon and then eventually thrive market.
- [07:32]
Rashid Ali
What was the tipping point? Or was there no tipping point? Has it been slow, exponential growth?
- [07:38]
Lauren Everts
Trader Joe's was a big one. I mean, we 10x the business from 2016 to 2017.
- [07:44]
Rashid Ali
What were the hurdles of 10xing the business? Because the people hear that, they're like, wow. But there's lots of challenges that come with that.
- [07:52]
Pete Maldonado
Being able to just make 10 times the product. Right. When your manufacturer was this small family run in Greentop, Missouri, this town that if you blinked, you would have passed the facility. So convincing them to take on the significant volume where more the facility could have taken. So we needed so much time to build and then the capital. Right. Because we. We were bootstrapped. And so we had to figure out, I think when we. When we got the initial POS first, they verbally gave us certain numbers. And Pete and I were like, okay. We, we. This is manageable. So we started talking to our manufacturing partners, our supply partners, like to make sure that we have enough. When the POS actually came in, I remember calling Pete. I'm like, dude, this is a lot more than we discussed. Like, this is a lot. Like, I want to be every single time these things happen. Like, I want to be excited. But then I go into execution mode. I'm like, how are we actually going to do this.
- [08:38]
Michael Bostick
And.
- [08:39]
Pete Maldonado
And so we had already convinced everybody, okay, we're on board. And now it was like. I don't know, it was two times what we thought it was going to be. And so then we were like, all.
- [08:47]
Lauren Everts
Right, the initial order is $1.1 million. So we did 400,000 the year before.
- [08:52]
Michael Bostick
For the whole year? Yeah.
- [08:53]
Lauren Everts
For the whole year, yeah. And so this was one PO which was going to be. It was supposed to be for, like, five months worth of product, but ended up being more like five weeks worth because the velocities were so much higher than we anticipated. So, yeah, we got. We. When we delivered it to him, we got a second round of pos, only, like, three days on the. On the floor. So it was another $1.1 million PO, which was insane.
- [09:15]
Michael Bostick
I want to pause you guys for a second because I think there's some gold here for people that are thinking about building a business. You said you bootstrapped the business, which we want to talk about in a second. But then when you get a PO like this, I assume you have to think about capitalizing the business because you can't yourself sustain the capital required to put an order of that size. So in hindsight, for people that are listening and thinking about building their business, are you glad you bootstrapped and then went this route, or would you think about capitalizing to begin with to go fast? Like, how would you coach somebody if they were. If they came to you guys right now and said, I want to go into food, and I have an idea, and I have, you know, these resources right now, but I want to scale it in the same way. Like, where would you tell someone to begin?
- [09:58]
Pete Maldonado
I would say I wouldn't change anything on. On the way we built the company. I think you want to wait as long as possible to take outside funds.
- [10:08]
Michael Bostick
Agree.
- [10:08]
Rashid Ali
I agree with you.
- [10:09]
Pete Maldonado
It will. You're. At the end of the day, you're diluting yourself. Right.
- [10:12]
Rashid Ali
The earlier you glamorize taking funds.
- [10:15]
Pete Maldonado
Yeah. And it's not. It's. It's. It's. It's sometimes a vanity thing where it's like, oh, look at. I raised X. But it doesn't help you at all. And the other thing is, if you take it too early, you fully don't understand your product, you fully don't understand your customer, you don't understand the points of distribution. And it's like, once you take money, then you're on the clock. Right. Where we were able to build a business and make certain decisions And I, I wouldn't change it. The one thing. And it's fortunate to kind of our relationships and, and where we're at. We got a little bit fortunate where when we needed the, the trader just po. We had to do a. We did a friends and family debt only round. So over a weekend we were able to raise a million dollars. A lot of people couldn't do that, right. And so my family kind of came, came in and helped. Pete had some, some friends that came in, but at the end of the day, like we still had to do personal guarantees. My, my brother who, who was, who contributed a pretty amount, he was the one that pushed for a personal guarantee. And I'm like, j. Like your brother. And he's like, it's business, right? So he, we gave him a very attractive interest rate and we were able to do that. So we raised that. That was, that was the capital influx that we needed to be able to support the initial po. And then we got that other PO Right off the bat. We asked them, hey, do you guys want to do it again? We paid them back immediately. Do you want to do it again? They were happy to do it because they. I think it was like a 30% return. And so we were able to do that. But then once we did that, we had enough cash to fund the business up until the end of 21.
- [11:40]
Lauren Everts
It was a 30% annualized return, but we did a 10% simple interest. We paid it back in whatever, four months or something like that, right?
- [11:48]
Michael Bostick
How do you 30% call you? Call me next time.
- [11:52]
Rashid Ali
How do you guys broach the friends and family thing? Like, what's the song and dance that you guys did to initially to get them to invest?
- [12:00]
Pete Maldonado
Yeah, I mean I was pretty transparent. I said like, like it's appeal from Trader Joe's. Right. Which is again, like that's, that's a certainty. I was like, but on the flip side, it's a food product, right? Like you. Everybody's overcooked a steak, right? And there's, there's issues with yields. There's all these other issues. So I was pretty upfront and transparent, but I was like, but on the flip side, like this. I'm going, I'm not going to let this fail. Like, Pete and I are going to be at this and we're going to make sure it's successful, but there's inherent risks, right? And as a result, we're giving you the, that the interest rate that we're giving you. And so they wanted the personal guarantee. There was a Little talk about equity. There's a lot more talk now about how they didn't get equity. But like we were, at the end of the day, we were stressed enough about the business. Like I think about in the early days, like if we had the stress of having an investor on our back too, like it just, it would force us to make decisions differently. And I'm just glad to talk about.
- [12:52]
Michael Bostick
That for a second because similar, we bootstrapped this business to the point before we went and raised capital when it got to the point where we needed to. And I'm glad we did. But I went a different route, which is like kind of I went a private equity route and not venture. I want you guys to kind of discuss what you mean one about having somebody on your back and to having a time clock because I don't think a lot of people realize what that means when they're thinking about raising capital. Of course your friends and family give you some money, you're not really on the same thing. But when you start taking the money you're talking about, what do you mean by that?
- [13:24]
Pete Maldonado
At the end of the day, like each of these, the private equity or VCs or whatever, they have an investment thesis, right? And in the private equity space, the mid market, it's a typically five to seven year window where at some point they need to be able to recoup that investment. These PS invest out of funds and so they have to close a fund to be able to raise the next fund. And typically they're trying to raise a bigger and bigger fund. So once they cut a check, there's an expectation and there's a clause in the agreement where effectively they get, they call it like the hammer where they can actually force a sale if they need to. And so say a seven year window, the clock starts. So you'd want that clock to start as late as possible. And also if you sell in the early days, your equity, the, the percent of ownership they're going to take is a lot larger than if you were to wait. And so we were able to hold off until the end of 20. The end of 21. We did do a minority raise to kind of de risk B and I, but we got, I mean it was like an over $200 million evaluation. So it was, it was like it.
- [14:23]
Michael Bostick
Was years and years into the business.
- [14:24]
Pete Maldonado
Exactly. Yeah.
- [14:26]
Rashid Ali
I want to talk a little bit about weight loss. So I have, I did lose 60 pounds. And a huge part of that was attributed to upping my protein and meat and things like this. Really helped me because it kept me satiated and satisfied. It's a really great high protein snack. What have you guys seen with the feedback from social media when it comes to weight loss or protein? You mentioned earlier that this sort of started because you wanted to give your clients something that they could eat to feel satisfied. What's that been like?
- [15:03]
Lauren Everts
I mean, we've had a huge presence in any, in all these different trending diet tribes, I guess you could say. I mean, when we started it was all Paleo dieters, it was whole 30 dieters and it was a ton of, you know, crossfitters. And so there's always been this kind of fitness nutrition angle and, and it's kind of where we started nowadays. Obviously it's a little bit different. I think with like GLP1s coming out, they're huge. I mean, this is not, it's not a trend. I don't think this is going away anytime soon. This is the perfect snack for somebody that's eating or on a GLP1. Right. I think it, you know, and I think what, one of the issues I think we see with, with GLP1 is that for. I think it's every, every pound that's lost, a third of that pound is muscle mass. Now that's terrible because that means people are not eating enough food. It means they're in a catabolic state. They're breaking down muscle and so they're, they are losing weight, but they're getting fatter in the process. That's a terrible thing. And so I think, you know, if you think of one of the, one of the leading indicators of, of lifespan is going to be muscle mass. So you're losing muscle mass and you're taking these things, you're just not eating. You're starving yourself. So that's why doctors are telling you, make sure you're eating enough protein. And that's why chomps is a great thing for that. We're seeing an increase in a lift in sales because of it. Never thought that would happen. We never could foresee that happening. Which, you know, we're happy it is.
- [16:21]
Michael Bostick
I think there's also a real moment now where meat is having a comeback. Like meat had some bad as it should.
- [16:26]
Pete Maldonado
Yeah, yeah.
- [16:28]
Rashid Ali
I mean, everyone was like, go vegan.
- [16:30]
Michael Bostick
Well, for, you know, for people that have been eating meat for the longest time, it's like, yeah, duh. But there's a lot of people that are now coming around that were thinking about not incorporating meat in their diet that are now saying, like, wait, Maybe I should. And so I imagine that's also helpful when people are looking for quality sources of meat.
- [16:43]
Rashid Ali
And this has. It contains 10 or more grams of protein per stick. So for me. But you know what? Also, you're selling to me. What do you think I'm gonna say?
- [16:54]
Michael Bostick
Time?
- [16:55]
Rashid Ali
Yep. You're selling me time. I can run out the door, I can throw three of these in my purse. I can eat them quickly, I can be efficient about it, and I can get my protein in. To me, I don't even look at this as anything other than getting my time back. Cause, like, I'd love my bowl of meat, but, like, sometimes you just don't have time. So that's what I really like about them.
- [17:18]
Michael Bostick
Well, also, I wasn't joking. Like, they're in the office. And when I start to feel like I need something, I'm gonna have that crash. And I don't wanna go, by the way. I don't know what's going on in this pantry here. If I had a. Whoever's running this operation's gonna be in there. But I look in that pantry sometimes, and the only. I'm like, okay, if I see a bunch of chomps in there, I can have two or three of these things and then just keep going without having to go have a crash.
- [17:36]
Pete Maldonado
And you don't feel guilty about it?
- [17:37]
Michael Bostick
No, I don't feel guilty about it at all.
- [17:38]
Pete Maldonado
And it tastes good. And so I think it's interesting. Cause if you talk to our. Our customers, like, they're very passionate about the brand. And I think what happens is a lot of times they got introduced to chomps when they were doing paleo keto, whole 30. And a lot of times when you're doing a diet from personal experience, all you start thinking about is what you can't have. So if there's something that's convenient, that's tasty, and it checks the boxes, you don't have to feel bad about it. You then create this emotional connection with it. And that's where, like, if you think about Chomps as a company like Chomp, not only are we performing very well from a growth perspective, our repeat rates, right? Our basket size, like, the consumers buy it, and they buy a lot of it, and they buy it all the time. And it's moved from. We used to sell per stick, right? Where it's, like, on the go, grabbing. Now we've moved into these pantry packs where we're bringing multiple sticks inside the home, where it's like, maybe the mom was eating it. Initially, and now the kids are eating it, and the dad's eating it, too. And so now, if you think about why we're growing so quickly, it's because, like, it's just a numbers game where people are consuming so many more in the household, and it's really translating to significant growth.
- [18:43]
Michael Bostick
Well, I think it's so interesting because you guys have been doing this for a long time now, and I was, you know, this year will be our ninth year doing this show, which seems. It feels short to us, but I guess it's longer for. Than most people that do this. And what I find so fascinating is you're sitting in a real moment in time where I imagine this is getting so much momentum because the conversations that are starting to populate around protein in quality meat sources and getting rid of junk and having clean ingredients and all these things is just, you know, like, it's weird how kind of like, the winds start to align. And for. For people that are new to your brand, that would be like, this feels like it came out of nowhere, but for you guys, I imagine it's like, finally, like, people are talking about this. Does it feel that way?
- [19:25]
Lauren Everts
Absolutely. Absolutely.
- [19:27]
Michael Bostick
Yeah.
- [19:27]
Lauren Everts
And it's actually funny because you. We've been doing it for a really long time, and I'm the type of person, I get excited about the next big thing, and I'm always kind of thinking about, like, do we bring more innovation out? Like, why are people not talking about this? Why is not getting, you know, big enough or whatever. But now we're, I'm realizing, like, staying focused on what we were doing and keeping it as simple as we possible possibly can. That's why we're in the position that we're in right now.
- [19:48]
Michael Bostick
Yeah, I imagine. And I talk to Lauren about this all the time. When you're an entrepreneur and especially when you're creative and you have a brand, you're, like, looking at the next flashy thing in the trend. And it takes a lot of discipline to not go and jump onto that thing and just stay true to what you're doing. Have you guys been able to do that over the years? Especially in the early days when it was slower?
- [20:07]
Pete Maldonado
I would say it's the balance in the way that Pete thinks looks at things and I look at things have helped allow us to, like, you describe it pretty well. Our relationship with, like, the. The truck barreling down the road.
- [20:17]
Rashid Ali
Oh, what's the truck? I want to hear this because I have this with my coo.
- [20:20]
Lauren Everts
So the analogy is if we were if chomps was a truck battling down the road, I'm the guy with my foot pinned on the gas. Rasheed's steering, and he's also set up the guardrails so we never fly off the highway.
- [20:30]
Rashid Ali
That is literally the exact situation I'm in. I'm you, I'm Peter. It's fun to have your foot on the gas.
- [20:39]
Lauren Everts
Yeah.
- [20:39]
Rashid Ali
It's just you might crash into a tree. You ought to have someone giving you guardrails. I totally get exactly.
- [20:44]
Lauren Everts
That's. That's what happened to me in all my previous ventures. It was, it just going too fast and too much. And then, you know, he kind of helps balance it out.
- [20:50]
Rashid Ali
So you have to know what you don't know. This is what I've learned about business is like, I, I have. You have to be able. I think people are like, oh, you got to learn every avenue of the business. Sure. But I also have to dou. Triple down on my strength and surround yourself with the right team of people so you, so you can do what you do best. 12 years in business. What is your day to day look like today? Where are both of your focuses now? I'm just curious to know, like, as a business owner, what it looks like down the road. Like, what are you guys actually doing day to day?
- [21:27]
Pete Maldonado
Yeah, I would say now we now have a president and coo. For me personally, it's gotten me out of the weeds. Like, I used to spend a lot of time at the production facilities. I've traveled the world to meet with our suppliers. And at the end of that, you have to start thinking about, well, your time is a limited resource and where is it most valuably spent. Right. And so I think now it's more about, I call it heads up thinking versus heads down thinking. Right. We start thinking about what's next, what are the risks. Right. We're growing very quickly, but it also means that you have a target on your back where it's like more eyes mean there's more, more risk coming down the pipe. So we're trying to figure out, are we making the right decisions now? Is a moving business moving in the right direction? At what point do we have to think about out of category and strategic things? So like, I think historically, if you think the last three to five years, I was really focused on ops, finance, back of house stuff to make sure it's in order. We have a amazing team that's way better than I am at doing that stuff. And they, they, they have that covered. And Pete was really focused on the sales, marketing, creative, like the big ideas now I think it's really about long range planning strategy, like what's coming down and then also just thinking about like what risks, right? Like there's a new administration coming in. What's that gonna do to the, to the potential business? There's a lot of risks around a potential port strike. What does that mean? There's a lot of changes as far as the way, you know, the government is thinking about the food pyramid or make America healthy again. So there's a lot of these things. So now what we're trying to figure out is like, let's not distract the team from all this stuff coming in. Let's. Let's figure it out and think about what that means for the business from a planning perspective.
- [23:02]
Rashid Ali
What is your guys goal? Like do you want to sell? Do you want to keep going? Do you not know or do you have a goal?
- [23:10]
Pete Maldonado
I think at the end of the day, the goal, like Chomps is our legacy, right? We've been doing this for a long time and we want to make sure that it's not one of those brands where it's like, oh, remember that brand Chomps? Like at the end of the day, like we want to be the noun, right? Early days we used to. There's another very popular meat stick that everybody talks about at the gas stations. We want to be the noun. We want this to be our legacy. At the end of the day. Dupiet and I need to be at the helm. Not necessarily, but we want to make sure that the company's set up for ultimate success, depending on where it ultimately lies. But again, we did take outside money at the end of 21, so we talked about the clock running, but we definitely have time and we have very patient partners that see what we're trying to accomplish and they're very patient and want to make sure that we build something that's so large that regardless of where it lies, like they can't, it's. You can't break it.
- [24:00]
Lauren Everts
The goal of the business is optionality. So like what we're doing now is to set it up for all of the above is you want to ipo, you want to sell the company. Whatever you want to do, you can do.
- [24:10]
Michael Bostick
You don't want the pressure to have to just do one thing or the vulnerability of having to only have one successful outcome. Oh, smart.
- [24:17]
Rashid Ali
Do you want to know what else I love about meat sticks? I like how they sculpt my jaw. Have you heard this?
- [24:23]
Lauren Everts
Okay, yeah, yeah, yeah.
- [24:24]
Rashid Ali
The Chewing.
- [24:25]
Lauren Everts
I heard the. The dentist was on. He's like, give your kids a meat stick and see. Yeah, yeah, I heard him talk about see.
- [24:30]
Michael Bostick
No, but it's true.
- [24:31]
Rashid Ali
So good for your jaw. If you're just eating, like, soups and broths and smoothies every day, you're not working out your jaw. And I am all about the jawline with the mouth tape and I think the meat sticks. I. Since I've been eating more meat, it's working out my jaw. Is that weird?
- [24:46]
Lauren Everts
No, it's not weird.
- [24:47]
Rashid Ali
I can be in your next commercial. You know what I like about meat sticks?
- [24:53]
Michael Bostick
You don't even need Brandy Savage. You just get Laura.
- [24:55]
Lauren Everts
There you go.
- [24:56]
Rashid Ali
I've been chomping on meat sticks.
- [24:58]
Michael Bostick
No, but it's true. Because even for our children, there's a lot of parents, and I'm not passing judge, but we do this smoothies. But it's smoothies all the time. It's like, you want the children to develop that jawbone. So getting them these kind of treats and having them chew and use their jaw muscles is so important, especially for the development of their faces.
- [25:16]
Lauren Everts
Agreed.
- [25:17]
Rashid Ali
How do you guys think about competition? Or do you not think about it? You kind of mentioned a little bit, but what's. Do you guys look at it? Do you just ignore it?
- [25:26]
Lauren Everts
We're aware, but I don't think we allow it to change decisions or strategy in any way. I think that's like, we've been super disciplined about that. Right. It's kind of like, oh, this guy's doing this. But, okay, well, here we go. Let's keep, like, we just stay down a path. We never. We've never gotten off course because of what someone else is doing. On the flip side, I've seen the. Some of the guys that we compete with changing their strategy based on maybe what we're doing, and it doesn't work out.
- [25:52]
Pete Maldonado
So, yeah, I would say we don't ignore it. Like, we monitor it. We know exactly what's going on, but we don't let it impact the way we operate and the decisions that we make. I think in early days, like, you know, there are certain brands that were doing really well, and we're like, oh, I wonder who so and so used for this, this, and this. And we would. We would copy them, and we would try. Well, if. If our ex bar was using this partner, we should do that because they were crushing it back in the day. And so, like. But we found out, like, every time we just would try to copy somebody, it would never work. So like now we have this like chomps lens where like we, we take all the information in and we figure out like, what does it mean for us and make sure that it's the right decision for the, for the business.
- [26:30]
Michael Bostick
What are some early mistakes you guys would coach your younger selves to avoid for people that are just getting ready to start their own thing? If you can think of any.
- [26:39]
Lauren Everts
I think that so many, yeah, so many.
- [26:41]
Pete Maldonado
But yeah, I think that that's one of them. Is, is, is, is looking at what others are doing and assuming that you see similar results, like each brand, each company, every situation is so different and it, it doesn't necessarily mean it would mean success for you. And I think we went down a couple paths that it was a waste of time and it didn't yield any results.
- [27:00]
Michael Bostick
Well, I'll like, I'll share some personal stuff here that I don't like really talk about that much. But people, you know, that's any business you do, especially if you're talking to outside partners, they always ask you that question, like, well, who would you consider your competitors? You know, like that. Anybody that's ever pitched anything that goes to whatever category you're in. And I personally always have the hardest time answering that because to what you're saying is like, I'm aware of other people that are in our adjacent spaces doing like, I'm aware of them, but I pay so little attention to how they're actually doing things. And large and part the reason dear media exists is because those people were doing things that way. It wouldn't, it didn't, it didn't work for us. Like if we would have tried to copy that version, we would have failed in the first year. It's like the only reason that this thing exists is because we kind of just did it our own way in a completely disregard to what they were all doing, if that makes sense. And so whenever I get asked that question, I'm like, I know of people that are in these spaces doing these kind of things, but I'm not aware of like how we would compete because we don't do similar things outside of like there's other people in food, there's other people in media, right? There's like, there's that adjacency, but there's not like the teams are set up differently. The mission, the operations, the way that we set everything up, the way that we think about branding, like not no shade at any of those people. Like they're obviously successful and top of mind because they're doing something. Right. But my point is I think if we would have thought about what everyone else was doing constantly in the early days, we would just never had a business. Yeah, I think that's what you're, what you're kind of saying like it's, it's really hard to stay disciplined and do your thing then.
- [28:30]
Pete Maldonado
And I think for charm specifically like Pete and I came to with, with very no background in retail, cpg, food. So like we did, we didn't know what we didn't know. Like everything we did just made sense and we built the business. It's honestly pretty simple and straightforward. Right. I mean at the end of the day we, we sell sticks. We sell a lot of them. 90% of our sales are three recipes.
- [28:53]
Michael Bostick
Well think, I actually think that in some ways like people is again they ask for experience but if you would have come in and looked at what their strategy was and they were doing, you would have just been a second rate version of something that in all of our eyes is maybe not the quality we were looking for. Right. So it just wouldn't have worked.
- [29:08]
Pete Maldonado
Right.
- [29:08]
Michael Bostick
That's how I think about anytime someone comes in like I'm going to just go and do what this person or this company has done, but I'm going to do it. You know, I'm going to try to copy their formula and do it better. I'm like it's not going to be what you want it to be.
- [29:20]
Pete Maldonado
But I would say like the passion behind the company definitely changed. There was a, there was a tipping point. And you think about when, when P and I started it, two single guys wanting kind of a side hustle because we both had full time gigs. You know, originally it was Pete had gone to the CrossFit Games and he'd seen how jack these guys were and it was like they were a cult following. Right. If one guy was doing it, then they all started doing it. So, so Pete's idea was like can we figure out a product, make some money and sell it to CrossFit? Like that was kind of the original premise. But fast forward, Pete and I are both married, we both have three kids, right. And we start thinking about like we start reading labels more closely and thinking about all the snacks that they're eating and how much sugars and carbs and it's like it completely changed. The way we thought about the brand was like, let's do our part to offer a protein snack that you don't have to feel guilty about like 70% of our consumers right now. Are still female. But you think about, like, the opportunity with kids and the male demographic, like, it's, it's pretty huge, but there's real passion behind it. And the passion now has pushed down to our team. Like, you know, when we go to trade shows, like an Expo west, that's the big natural food trade show, like, people are really proud to wear that Chomps logo and say they're part of the Chomps team. And it's, it's pretty cool. And it's really resonating with the culture now. So it's really evolved over time.
- [30:37]
Rashid Ali
You guys have really built a brand. When I heard when someone wants to wear your merch and they're proud of it, like, that's, that's a real brand. I think a lot of times you like, have a brand, but you would never wear it. Does that make sense? Like, I think glossier has done a really good job of that. People wanted to wear their name on a sweater.
- [30:55]
Michael Bostick
It's gotta be a wild feeling to be like, we created a meat stick brand that people want to wear clothing.
- [31:00]
Rashid Ali
It's a great name. The name is a great name.
- [31:02]
Lauren Everts
And it was funny when we were starting this, the big, like, you know, vision was like, look what Red Bull did with energy drinks and how these kids are in the high schools and they've, they've got the Red Bull logo all over. They're putting on their helmets, they're putting all over their, their bikes and stuff. Like, how do we get to that level? We have work to do to get there. But I mean, I think we're on the way.
- [31:20]
Michael Bostick
No, it's a lifestyle thing. It's kind of what it, it's what the person's trying to convey about themselves. For sure. Like, I care about this kind of quality and this kind of, this kind of. And that's what I was saying earlier. Like, I think we're about to be in a moment in time. You're touching on the new administration. Whether you like or dislike the way the election went, I'm excited that for the first time in a long time, this country's talking about health. And I think you guys are gonna be benefactors of the wave that's coming where people are going to want to start thinking about putting higher quality ingredients and foods into their bodies. I mean, we've been poisoning ourselves for a long time now.
- [31:53]
Rashid Ali
What strategic ways are you guys working with social media? How are you leveraging social media with your brand? What are some things that you've seen that really hit, really work the things.
- [32:04]
Lauren Everts
That hit for us are usually surprising. So, for instance, I think some of the top performing influencers were interior decorators, meat sticks, and it just makes sense, right?
- [32:15]
Rashid Ali
Well, they're busy. They're on the go. They need to grab something.
- [32:18]
Lauren Everts
I don't know, but I think their audiences are just super aligned to your point. Like, it's saving time. It's hitting. It's checking all the boxes for these people.
- [32:26]
Rashid Ali
Doesn't spill on my white couch when I give it to my son.
- [32:28]
Lauren Everts
Yeah, exactly.
- [32:29]
Rashid Ali
Saving time.
- [32:30]
Lauren Everts
Yeah. So that's. That's worked out well for us. Yeah. I mean, I think just like, really anything authentic, that's the biggest thing. Like, we're not gonna go pay for some big. I know, you name it, celebrity or some big athlete. We actually do the opposite. We're usually working with. It's usually like a mommy that's got a good following. That's, you know, just someone like yourself, actually. It's just kind of. Kind of the people that work with.
- [32:52]
Pete Maldonado
Us, you know, I think the most successful influencer partnerships have are ones where they would reach out and say, like, hey, I love your product. Can I just get a. An affiliate code on Amazon? Or like, they actually reach out and want a partner because they're truly a consumer and love the product. And then little by little, we'll start doing more paid partnerships. And those just perform so well versus trying to get some. We've actually never gone down the path of a big celebrity just because we just don't necessarily believe in it. We want to make sure that they truly are passionate about the product and consume it in their everyday life. And then we weave it into the way they, they. They share their stories and post. But those. That's where it worked, I think. I don't know what it's called. It's not a nano influencer, but I would say, like, anywhere from a couple hundred thousand to a couple million followers. Like, not massive, but definitely some traction.
- [33:39]
Rashid Ali
How is your team structured over 12 years? How many people are on it? What does it look like?
- [33:45]
Lauren Everts
We've got over 140 people.
- [33:48]
Rashid Ali
Damn. And you guys started with two, right?
- [33:51]
Lauren Everts
Yeah, yeah.
- [33:52]
Pete Maldonado
Two until 2018 is like 2018 is.
- [33:55]
Rashid Ali
When the growth in between there and then how you got to 140. That's a lot of employees.
- [33:59]
Lauren Everts
Yeah.
- [34:00]
Pete Maldonado
And we don't have manufacturing. It's all co, man.
- [34:02]
Rashid Ali
Are you doing it in house?
- [34:03]
Pete Maldonado
No, no, the manufacturing isn't in house. So, like, that 140 is finance, ops, marketing. But it's like we Have a stack.
- [34:09]
Rashid Ali
So that's not the manufacturing. Got it. So talk to us about how you went from 2 to 140.
- [34:15]
Lauren Everts
Yeah, it was an interesting evolution. So we started. So like, let's start with like, sales, for instance. You would think, like a lot of like brands, what they usually start with is you stock stack the sales team, right? You want boots in the ground, knocking, kicking indoors. We did the opposite. It was me selling. And we hired one sales guy in 2018. Then we hired data guy, data people. So data insights, that was super important for us. And that's something that most small brands don't think about early on. But you need to be able to tell your story. For us, it's a story of incrementality, and we're able to show using data that we're bringing new customers to the category. So put us in the meat snack set. We're not stealing share from whoever other brands on the shelf. We're actually bringing new customers to the set.
- [34:57]
Michael Bostick
And is that data helpful not only for investors but for retail partners?
- [35:01]
Lauren Everts
This is the story. You walk in. That's music to their ears because they're like, oh, wait, you're gonna grow the category. Not just ste deal, share. So that's. That was early on. We had that and we were able to prove that out.
- [35:12]
Pete Maldonado
And the other side of it was sales ops because we figured out, like, I say this with the most humility. Like, it's easy to get on the shelf. Like to get the initial PO to get, like, that's. That's the easy part. The, the hard part is velocities turning, making sure you're in stock. And so we realized the insights that data would allow us to get on the shelf. And you hire sales ops to make sure that are they order. Because you may be getting a really big, huge PO when you get excited, but you kind of get blinded by the light because then if you double click to say, like, well, they shouldn't be ordering this much, right? It should only be this much. And being able to go back and be like, no, no, we got to cut this in half because we don't want inventory just to sit in the back room, right? We want to make sure that it's. It's turning. So like, we. We brought in a really strong sales op team to make sure that we really manage the customer relationship and help them. But I think those two pieces are quite unique and rare. And typically all people think about is sell, sell, sell. We. We thought a little bit different. I think between Pete and The resource we brought in that was more than we needed. We were really thinking about how do we grow the business the right way. And it's not to say that we weren't, I mean we were doubling or tripling year over year. So we were, it was, it was growing well, but we did it really deliberately.
- [36:19]
Rashid Ali
And now with 140 employees, what are, what does it look like, the separation of each category?
- [36:26]
Pete Maldonado
Yeah. So I mean we have a strong marketing team that's doing, we have an internal creative team, we have an influencer like social team. Our E commerce team falls within marketing. So that's like chomps.com, that's Amazon, that's thrive market. So any platform that's selling online falls within marketing. We have a sales team where it's your traditional relationship selling and they own like the brokers. We also have a field team that rolls within that sales team. So we have boots on the ground that do demos, make sure the shelves are stocked the right way. Then we also have a sales strategy and insights or category management strategy. So if you think about it say like a mass retailer will leverage that team to think about the overall meat sticks category, there's almost like this Chinese wall where like our sales guys and the sales strategy won't interact. They talk to, they talk to the mass retailer from a category strategy and saying like this is the overall category. Chomps fits into it, but it's not necessarily the overall story. And then you have the sales team really managing what does it look like, the relationship wise and what should the portfolio look like. So that's kind of like, that's sales and marketing. And then on the flip side you have operations, a very robust operations team. Even though we use third party manufacturing, we have folks that are really experts at making the product because it's a very hard product to make. We don't use sugar and sugar actually helps in the manufacturing process. And then when you remove a lot of the other ingredients, it just creates a lot of variability. So our, our manufacturing team creates standards across all our manufacturers as far as they have to follow X, Y and Z to make sure the product turns out the same way. So that's on manufacturing. We also have a food safety quality assurance team. Right. They're the ones making sure that there's no issues. A lot of stuff's happening in the meat space right now with, with Listeria and a lot of these recalls. So we invest heavy on, on quality control to make sure that we get ahead of it. Supply chain fulfillment, all that as well. And then we have finance, accounting and HR people. People and culture.
- [38:24]
Michael Bostick
And how do you guys typically manage setbacks or mistakes? I'm sure there's been a few over the years. What is it, what is it like? What is a vulnerability for a business like this? And what do. And. And how does the team respond to them?
- [38:38]
Lauren Everts
I think like, now the bigger you get, the more of a target you have in your back with any business, really.
- [38:44]
Michael Bostick
You said that earlier. Yeah.
- [38:45]
Lauren Everts
And so we start, you know, we're starting to hear just weird things that you never really heard before. Like, it's just the way it works. Right.
- [38:50]
Michael Bostick
So exciting stuff.
- [38:52]
Lauren Everts
Yeah.
- [38:52]
Rashid Ali
Can't wait.
- [38:53]
Lauren Everts
Things to sign up for, you know, But I think for us it's. There's like other things, if I think about vulnerability vulnerabilities, like things that I don't love about the product. It's single use plastic. That's one of the things I don't love. Right. I wish we could change that. But you can't. If I want a shelf stable product, I need to have a seal and you have a vacuum seal that doesn't break. So this is the best thing that we've got right now. We're doing things which we haven't announced yet that are coming up this year, which will. Will actually offset that, which we're really excited about. That's kind of the way that we, we're constantly. We nitpick more on our product than anybody else would on the outside. Like, we know the vulnerabilities and the things that aren't great about our product and we're already working on ways to fix them.
- [39:31]
Pete Maldonado
I would say on the. We mentioned 140 people. That's in a fully. We're a remote company.
- [39:36]
Michael Bostick
Oh, wow.
- [39:37]
Pete Maldonado
And so that in itself is wow. Yeah, it's tough. So 2018 is when Pete was full time. I was part time. I went full time. In 2018. We opened an office in Chicago and we started hiring. And so we were all in the office Monday through Friday. And that was the case until Covid right in lockdown came. We realized we're like, let's just go fully remote. It allowed us to hire the best people all over. Right. And so it really opened up the caliber of individuals we could get. But it just created like, how do you build culture but then you're fully remote and how do you do that successfully? And I think we've figured out a formula that's been working well. But I mean, it's tough. Like, it's really tough because there's so much about that water cooler being around, especially, like, folks that have never worked before. Like, I think all of us at some point have worked in some sort of office environment. So you learn so much just by sitting next to somebody, and. And. And otherwise, you're kind of the problems that you face. You're in your own head. Right? You're sitting there trying to figure out on your own. So that's where we spend a lot of time figuring out, like, how do we continue to keep the culture the way it is, but in this fully remote environment?
- [40:38]
Michael Bostick
And my two cents on that is it's possible we have, like, a little bit of a hybrid, but similar to you guys, we had everybody's kind of start 2018, 2019, then fully remote, 2020 through 22, roughly. I think it's hard to start a business in the beginning fully remote. But in the beginning, if you've kind of set a base of a culture and had the core people meet and then go remote, it's gonna be easier. But I've had some friends that since then have tried to start companies fully remote. And I think that is a really difficult challenge, because in the beginning, I think, like, the special thing in the early days is you're kind of, like, all agreeing on a specific mission, and you're all kind of coming together in one specific culture, and then that can kind of be shared. But when you're all starting remote from home, I think it's really difficult to do.
- [41:22]
Pete Maldonado
That's probably one of the reasons we've been successful is because a lot of our early hires are still with us, and they kind of. We were in the office together. We kind of. We weathered kind of COVID together, and I think that brought a lot of us close, closer.
- [41:35]
Rashid Ali
That's the best.
- [41:35]
Lauren Everts
Yeah, those people are the, like, the champions of culture too, right? Like, they are protective of the culture. When people. Someone's coming in and they're not, like, they're not fitting the culture, like, they'll call it out. And so, yeah, that's why I think.
- [41:47]
Michael Bostick
It'S so important to have that. I guess my advice is if you want to build a remote company, you can. But maybe think about in the early days, starting it actually opposite way. Like, start at first in office and then go remote, as opposed to starting remote and then going to office.
- [42:00]
Rashid Ali
I have to read this. Is this true that you. It says you started chomps in Pete's apartment in 2012 with a $6,500 investment, and now you guys are the fastest growing Brand in food in the United.
- [42:12]
Pete Maldonado
States and based on the last 52 weeks. So that's not like a near term stat. Oh, the last 52 weeks of data?
- [42:18]
Rashid Ali
Yeah, with 270. 200%.
- [42:21]
Michael Bostick
In 72% growth.
- [42:23]
Rashid Ali
Oh, we'll have you do the numbers, honey. I do other things, whatever. Is that true? That's amazing.
- [42:30]
Michael Bostick
Yeah.
- [42:31]
Rashid Ali
If you were to tell our audience to start with one, what would it be for? For me, it would be the original beef stick just to get your chomps wet. And then if you like spicy, the jalapeno. What are both of you guys picks?
- [42:45]
Lauren Everts
The OG you can't go wrong with. But for me, it's the two newest ones that we've got, the taco and then the, the smoky barbecue.
- [42:51]
Michael Bostick
I haven't had the taco yet.
- [42:54]
Pete Maldonado
Yeah, I mean, like, we've been eating chomps for a while. So like, typically the newer flavors are the ones that I like.
- [42:58]
Michael Bostick
So like, how many chops you think you've had at each at this point?
- [43:00]
Lauren Everts
Oh, my God. I don't know. I probably eat three, three or four a day. So still not.
- [43:04]
Rashid Ali
So what are your favorite?
- [43:06]
Pete Maldonado
So smoky barbecue is my favorite right now. And then we are, we have the turkey line. Pepperoni turkey. I don't eat, I don't eat pork. So like, for me to finally eat pepperoni, like, I feel like it's what I've been missing all my life. So the, the pepperoni turkey is pretty fantastic too.
- [43:19]
Rashid Ali
What's the most creative thing someone's done with these?
- [43:21]
Lauren Everts
Oh, my God. So like, so during COVID we, like, there was like this meat shortage everyone was talking about, right? So people started using chomps as an ingredient in like other meals that they were making. So the UGC coming out of that was insane. Like, people were just posting pictures of these meals they created. And then we were like, we'd reach out and be like, hey, can you give us that recipe? And then it turned out now we've got an entire page on our website which just chomps recipes and people using chomps.
- [43:45]
Rashid Ali
And what's the best one?
- [43:46]
Lauren Everts
I mean, they've used it for taco meat. They just like, just a salad topper.
- [43:50]
Pete Maldonado
One of the coolest campaigns that the team came up with when we launched the pepperoni turkey is they partnered with all these like small pizzerias in, in, in throughout New York. And the influencer kit was a pizza box with a chomps branded pizza cutter and like seasoning packet. Even had like the, the metal. Right. The tin that you put Pizza on. So it was a. The team came up with. It was pretty creative. But that was a good way to. To.
- [44:15]
Rashid Ali
You guys gotta partner with Lunchables and get rid of the fake meat in there for the kids and put Chomps in there.
- [44:21]
Lauren Everts
It could be. It might be on the radar. You never know.
- [44:24]
Rashid Ali
I don't know. I would like that to a quick, like a little lunchable. That's healthy.
- [44:28]
Michael Bostick
No, but I imagine what's happening. And again, not to throw so much shade, but this kind of product is going to replace a lot of these things that unfortunately we grew up with and poor ingredients that we kind of all partook in for a long period of time. And I think, you know, as a parent, when. Now that we're aware of a lot of these opportunities and ingredients, when I think about, okay, what am I going to feed my kid? Like, what snack can I give them? It's something like this, not a Lunchable.
- [44:52]
Rashid Ali
But why isn't the Taxi Cabs Uber and why isn't Blockbuster, Netflix? You have to disrupt yourself. If you're not constantly disrupting yourself, someone else is going to come and take it. On that note, where can everyone find you guys? Do we have a code? Can we do a giveaway?
- [45:08]
Lauren Everts
Do all of the above. Chomps.com, we have a code skinny for.
- [45:11]
Michael Bostick
15% off your order. Chomps meat sticksomps.com Again, code skinny. And you guys want to do a giveaway for the audience?
- [45:17]
Lauren Everts
Sure.
- [45:18]
Michael Bostick
What do you want?
- [45:18]
Rashid Ali
We give away a lot of Chomps.
- [45:20]
Lauren Everts
Yeah, let's give them away. Okay.
- [45:21]
Michael Bostick
What's the boss? We're saying.
- [45:23]
Lauren Everts
Yeah.
- [45:24]
Rashid Ali
Okay. All you guys have to do is tell us your favorite part of this episode with the Chomps founder on my latest post at Lauren Bostick and make sure you're following Chomps on Instagram is at Chomps. The Instagram handle. I would go on and use code Skinny. I would start with the original B stick. If you hadn't have. Haven't had it. It's such a good one to put in your handbag or to travel with. I give it to my kids and it's so good. It's like the perfect flavor.
- [45:48]
Michael Bostick
These are lifesavers on flights too, because airplane food is not great.
- [45:53]
Rashid Ali
No where can everyone say hi to you guys if they want to say hi?
- [45:56]
Lauren Everts
LinkedIn. I'm on LinkedIn and. Or Instagram. It's Pete Maldonado on both of them.
- [46:01]
Rashid Ali
Okay. I gotta get your wife some mouth tape. You said she listens. Yeah, the Chomps and the mouth tape. With sculpted jawline is like, I'm just.
- [46:08]
Lauren Everts
Glad I'm finally doing something she's proud of. So we'll see.
- [46:13]
Michael Bostick
I think she's proud. I think you've done pretty well.
- [46:16]
Rashid Ali
I have a feeling that you guys will be back on the podcast in, like, eight years, telling your story of how you sold or did something crazy to some big conglomerate.
- [46:25]
Lauren Everts
We'll see.
- [46:26]
Rashid Ali
Yeah.
- [46:26]
Lauren Everts
Hopes.
- [46:27]
Pete Maldonado
Hopes.
- [46:27]
Michael Bostick
Come back anytime, guys.
- [46:28]
Pete Maldonado
Yeah.
- [46:28]
Rashid Ali
I'm excited to see what's next for you guys. Thank you for coming on the show. Thanks for having us.