· David Senra, Peter Rahal
[00:00:00] S0: What do you think is impressive about the output that you're doing right now? What does that mean? [00:00:00] S1: We're only two years old and it feels like five years. So our relationship with time is really bizarre. But in two years, I mean, we're run rating over 400 million this year. We'll do 300 million this year. We're in the frozen category. We're obviously in protein bars. We have an RTD. We've launched a confection with three different formats. We're launching another brand in November. In my field, you don't see that sort of output. And it keeps getting better. Like, all our products keep getting better. But I mean, we're the fastest growing food company, I think, no, I know, in history. So it's really hard to scale it. And the pace in which we're doing it, I think this would take normally 10 years, and we've done it in two. [00:00:00] S0: Explain to me why it's so hard to scale. [00:00:00] S1: Why it's hard to scale is because it's inventory. So you need to go buy the raw materials, convert it into finished product, and some of the raw materials take a long time. And for example, the dairy market was super tight. So if you don't... Like growing 300%, 400% a year is really, really... or even closer every six months is really demanding on the supply chain. To take Travis, like this is all atoms. Like, we're not a digital business at all. So, yeah, the inventory part is really, really challenging. So matching supply and demand has just been very difficult and... [00:00:00] S0: So you've had times in the company where you ran out of supply, correct?
· David Senra, Peter Rahal
[00:00:00] S0: So you've had times in the company where you ran out of supply, correct? [00:00:00] S1: Oh, constantly, yeah. [00:00:00] S0: Is this when you started... I saw Rob and everybody's been telling me about David Barr, and then I saw an ad and you were selling cod or something. [00:00:00] S1: Yeah. [00:00:00] S0: Is that as a result of the fact that you ran out of supply? What happened there?
· David Senra, Peter Rahal
[00:00:00] S0: Is that as a result of the fact that you ran out of supply? What happened there? [00:00:00] S1: The story of cod was we're creating our website and we're doing a comparison table. And the one metric we think is really important is how many of your calories are coming from protein. And on this chart, we were number one, and we were number one on everything. And for me, my investor influence, anything where I see a chart where it's all number one, I'm like, "It's bullshit." So we were like, "All right, well, we need to find something that's-" Number one, what has a better protein-to-calorie ratio than our gold product? And the only thing we found was boiled cod. And so in our comparison chart, we put boiled cod number one and David number two, and just left it there as like a dorky sort of comparison. And why it worked is like the juxtaposition between our bar and the cod is like signals convenience, it signals value, and like cod's pretty unappetizing. And then we're halfway through our first year, and I was like, it's like deja vu for me. I'm like, "This is super boring." Like another flavor. I'm like, "We need to do something bold." And so we're like, "Let's actually sell cod." And not like a stunt, like actually seriously sell fish. And so we did this boiled cod campaign, and it was funny because it was like- [00:00:00] S0: You like pain. Let me know.
· David Senra, Peter Rahal
[00:00:00] S0: You like pain. Let me know. [00:00:00] S1: Yeah, it was like got in the frozen business, and it's back to our brand values. Like, it was actually a very intelligent thing because it centered the conversation around protein-to-calorie ratio. So, but did it in a way that wasn't sort of like, hey, like right on the nose. It was like a little bit of a riddle. And it's like 55 dollars frozen cod online. Like, no one really wants that. So we didn't have product market fit, but it functioned as a really great communication tool. [00:00:00] S0: So creating a product for marketing benefits. [00:00:00] S1: Yeah, we call it product as marketing. I'm not giving up on it. Like, we're going to keep going. We're going to keep going on cod until we get product market fit. [00:00:00] S0: I don't think you will. I don't think you will, man. [00:00:00] S1: I know. It's funny because if you look at our website, it's like, protein bars, bronze and gold, pints, frozen ice cream, and then there's like RTDs, and there's like fucking fish. And it's weird, but like the whole food space is so fucking boring, to be honest. It's like they all say the same shit, they all do the same things. And so being a second time, I was like, "We've got to have some fun with it." [00:00:00] S0: Okay, so that was not in response to supply issues, because there was no demand for this frozen cod so far. [00:00:00] S1: Yeah, no. It happened to work at the same time we were out of stock on some things, but no, it was independent.
· Peter Rahal, David Senra
[00:00:00] S1: Yeah, no. It happened to work at the same time we were out of stock on some things, but no, it was independent. [00:00:00] S0: Okay, so let's go back to when I interrupted you because you started talking about pain. You said talk about building a masterpiece. What were you going to say there? [00:00:00] S1: Oh, it requires tons of discipline and intelligence, and it's done over time. And that's really what the brand David's about, is like finish your masterpiece and tap into everyone's inner excellence. [00:00:00] S0: But how do you apply it to building your company, though?
· Peter Rahal
[00:00:00] S1: Well, I think I start with like the what is a company? So our strategy is like two fundamental things in a company. People, it's all about people, as cliche as it is. And I think about the organization as a product. So my focus is all about that. And then the second piece is product and mastery of the product. And when I think of product, I think of brand and product as the same thing. Like, the product is just the raw thing, and then the brand is like what it wears, like the exterior piece. But if you try to look at the organization as a product, a company's just a group of people aligned towards a mission. So if that's the most important thing, like what actions does a company do to make sure that it's done? So for us, when I think of mastery is like we have four processes in the company that ensure our organization is done right and culture is lived. So if people are everything, who you select is the most important thing, who you select into the organization. How do you train and onboard them? Three, how do you select the ones to get promoted and rewarded? And then how you terminate the ones that shouldn't be there. So those four processes are really critical to building the organization and scaling it. And so we spend a lot of our time refining our hiring process. Training and onboarding is mission critical, and then promotion as well, rewarding the right behaviors, and then firing. And those are all organized around our value system, which is the best way to align a group of people to make sure the right behaviors are matching what we want.