Welcome to the Community Call Podcast.
I am Melissa Travers, Director of Community here at BevNET & NOSH, here with my co-host Jackie Brugliera and Ray Latif.
If you're enjoying the show, please follow and review us on Apple Podcasts, or your listening platform of choice.
Jackie, you are a Community Call Podcast Mainstay, but Ray, this is your debut.
So thrilled to have you here.
I'm thrilled to be here.
This is exciting.
This is a new podcast for me.
It's just fun to having another conversation with both of you.
We sat down earlier today for recording for Taste Radio.
I feel like this is just a continuation of our wonderful conversation.
Is it weird to sit in that seat, Ray?
Because I know earlier you had to flip seats.
You had to flip seats.
Melissa's seat.
It just feels like my back is kind of to the door, and I'm like a mafioso.
I never like to be in this position.
You always want to be facing the door.
That's the only issue.
But otherwise, no, this is fun.
You never know what Nate's going to pull over there.
The piano wire.
That guy in piano wire, you always want to watch out for that.
So yeah.
Well, it's so great to have you here.
I would like to start off this community call by doing something we oftentimes do, which is welcome a new person to our Slack community, which everybody can join.
If you just go to slack.bevnet.com, we are welcoming KB from Hodo Foods out of Oakland, California.
I had the opportunity to try Hodo Foods' new soy-based dips at Expo West.
Jackie, I think you said you also gave these a try?
Yeah, I did.
And they were really tasty.
I mean, first I showed up and I knew that they had tofu and soybean-based products, but I've only tried like their tofu crumble.
And then I was like, whoa, dips based on soybeans?
Let me give it a go.
And it was really, really delicious.
They had some interesting flavors.
I believe they have like a chili crisp and they have like a lemon and some other options.
I thought they were so tasty.
I know them from their blocks of tofu.
I was into making miso soup for a little while and I was very excited about their tofu and their dips were nice and creamy.
So welcome, KB.
It's great to have you here.
This made me think about soy in general.
And is soy healthy?
Do we know yet?
I feel like I have this question in my mind and I think it's delicious.
And you know, certainly I eat tofu in these.
I would absolutely eat these dips.
Well, I think soy milk was the original plant-based milk, right?
And then all of a sudden it seemed like, oh, maybe it's not the best thing for you.
We started to see almond milk start to dominate in terms of, you know, creamers or plant-based creamers.
And I don't know, it's weird.
I think.
Yeah, I eat a good amount of tofu because I try to eat primarily plant-based with a little bit of seafood sprinkled in.
And I know I've used like tofu to make my own like ricotta alternative and things like that.
But I also have question marks because I know I have to limit it.
I think that it impacts my hormones, but I'm not really sure.
So I think a lot of people probably have similar questions.
I dug into a few articles and spoiler alert, I still don't know, but an article from the Harvard School of Public Health pointed out that there's a certain amount of uncertainty due to the intricacy of soy's effects on the body.
It has a high concentration of isoflavones, which is a phytoestrogen similar to human estrogen with much weaker effects, of course.
And it may react differently in women versus men.
It may react differently in premenopausal versus postmenopausal women.
And then also certainly the kind of soy, whether it's fermented or not has an effect.
And also I think that whether it's non-GMO, whether it's organic, because the way that we grow soy here is it can be certainly questionable.
I mean, people have been eating soy for thousands of years and people love it and they eat it every day.
So I think it's okay.
And I think also a big point of differentiation for Hodo is just that it's a little bit more climate friendly than maybe like a nut dip or something that uses nuts.
I mean, if I were a tofu consumer, I think this is probably the brand I would reach for.
It's organic.
You can, there's a lot of different flavors that are associated with Hodo foods.
They have it in cubes.
They have it in block form.
You know, and frankly, I think I'm just kind of a coward because I love Thai food and there's a lot of tofu and soy in Thai food, but I just, I don't know what it is.
I can't get my head wrapped around it.
And it's not, again, it has nothing to do with the health benefits one way or the other, but it's just more like texture, I guess.
But this texture might be for you because if it's a dip and there's like, you know, like it's not the same texture.
It's just a dip texture.
So you might have to give it a try.
Do you see on there that they also have Yuba sheets?
This is something I had to look up.
It's the sheet of coagulated soy proteins that forms on the surface of a hot vat of soy milk, which it sounds delicious.
You can make noodles out of it, spring roll wrappers.
And then that made me wonder, like could you, for example, take the skin off of a vat of like pudding and use that to, as a dessert too?
Like how many skins, I don't know, how many skins do we employ in food production?
Quite a bit actually, depending on how many hot dogs you eat every year.
That's right.
You know, although I don't know if those are like real skins.
I think those are.
I don't think those are real.
No.
Yeah, we should probably, because Nate is listening in on this right now, he's probably just vomiting in his mouth, thinking about hot dog skins.
But he did send us an in-recording message.
Did you guys see this one?
He noted that soy milk is the best one in every way.
And I should have noted that Nate is our resident vegan.
I mean.
He would know.
He would know.
He would know about soy and soy milk in these topics.
We should have some sort of like pop-up Nate knows and just, you know, talk about all the things that Nate confirms and knows.
I feel like there would be a lot of pop-ups.
And very sarcastic, too.
Well, tofu doesn't necessarily have the strongest fragrance, but McDonald's French fries certainly do.
An article I came across in Foodbeast talked about McDonald's new scent marketing strategy.
They are debuting billboards that smell like French fries in the Netherlands.
These are plain yellow and red billboards.
There's no logo on them.
And there are drawers, these pullout trays with McDonald's French fries for the smell.
They're located within 600 feet of a McDonald's so that people can walk by and enjoy the fresh fragrance of McDonald's fries and then head right in and buy them for themselves.
Would this be delightful for you?
The question is why do they need a billboard when they have McDonald's right there?
I mean, you would think you'd be able to smell the French fries coming in.
Maybe they just have really good ventilation systems in the Netherlands that they don't have here in the United States.
Can't they just open the doors of the McDonald's?
I think they're trying to hit a bigger radius.
They're like, ah, this isn't working right here.
We need to get people that aren't even near the McDonald's to let them know that that's what they need.
I think smells have always elicited trial and purchase.
When I'm at Expo West, right?
You smell something really good in the hall, you're like, where is that coming from?
And you go to get it.
Whether or not people are enticed enough to buy McDonald's French Fries, which are probably healthier in the Netherlands than they are here, I don't know.
I mean, I just wonder how many people, maybe they don't eat enough French Fries, and this is why they're doing this.
Yeah, I don't know.
I think it works.
I mean, this just brings me back to my childhood of walking around the mall and smelling Cinnabon everywhere, you know?
And I was driving traffic to the Cinnabon, like pulling on my mom's arm, like making her go get some of that, or Auntie Annie's.
Those were delicious too.
I mean, it does work.
And I know that they've been using that for a while.
Or also Subway does it too.
They keep the ovens near the door, and they can smell Subway smells.
The bread specifically?
Yes, the bread specifically, not the meat.
You don't want to smell it again.
Yeah, you don't want to smell the toasted bologna.
That's got a very good smell, by the way.
No.
Have you ever had a hot bologna sandwich?
They're delicious.
I have, I had one in Nashville.
There's a famous music hall on Broadway which sells grilled bologna sandwiches, and it was incredible.
They're delicious.
I mean, bologna is just American mortadelle, right?
Oh, I wouldn't go that far.
I mean.
Hot dogs, hot dogs of deli meat.
In this country, that's a very good description.
It is the hot dog of deli meat.
I remember my little sister.
She would make a bologna mask, and she would bite the eyes and the mouth in, and then put it on her face.
She has a Hannibal Lecter kind of thing going on.
Yeah, before it was cool.
Yeah, well, I don't know.
I can't decide whether I like any of this or not, but in this episode of Community Call, we discuss a much more difficult decision that food and beverage brands are often forced to make.
Our guest, Michael Movitz of Brandjectory and NOSH's managing editor, Monica Watrous, talked about a decision that's often on the forefront of a founder's mind in challenging times.
And that is whether to stay the course because a crucial piece of success is right around the corner, or maybe a pivot is in order, or is it time to close up shop?
We'll share the questions founders can ask themselves and their teams and how to use those answers to figure out which direction to take.
Get the latest in natural food industry news trends and data with the NOSH Daily Briefing newsletter.
Choose the free light edition or upgrade to insider access for exclusive story recaps and insights.
Stay informed and stay ahead by signing up at nosh.com/dailybriefing.
Today on Community Call, we are thrilled to welcome Michael Movitz, co-founder of Brandjectory and Monica Watrous, managing editor of NOSH, talking about the question that so many brands are facing right now when things get tough, and that's whether to pivot, shut down or stay the course and how to figure out which direction to take.
Thank you so much for joining us, Monica and Michael.
It's a pleasure to have you both here.
Monica, why don't I start off with you?
This Community Call is a companion piece to the NOSH article that you wrote and published on NOSH.
I failed, but I'm not a failure.
Please tell us, what kind of feedback did you get from that article?
I know it's a topic that, again, so many brands are working through right now.
What did you hear from folks after that article came out?
I think there was just a great appreciation across the community for some real talk.
You know, we see on LinkedIn, there's a lot of highlight reels and successes, which are certainly important to celebrate, but not a lot of people talk, frankly and transparently about the challenges that they face.
And so I was really heartened by the founders that I interviewed for this piece and how vulnerable they were, just with the, you know, in mind to help other people through the challenges that they're navigating right now.
Michael, again, such a pleasure to have you here from Brandjectory.
Could you talk a little bit about Brandjectory, how you do business over there?
I know that with all of your experience, you're a perfect person to discuss this topic.
So please tell us a little bit about what you're working on over at Brandjectory.
Sure, and thanks for having me.
It's great to be here.
Brandjectory is a platform that helps CPG founders and CPG investors to connect.
And we also help CPG founders understand how to build an investable business and navigate the capital raise process.
Four pillars are our network, content, resources and process.
We are a subscription model, rather than taking a commission or a success fee on the transaction.
We are structured both with an online platform that has a matching algorithm, as well as offline virtual meetings that we facilitate between founders and investors, founders and industry experts.
We do a lot of education, a lot of coaching and a lot of support through the capital raise process.
You know, certainly you are the perfect person to join this conversation with Monica and myself.
Michael, what are some of the conditions affecting CPG brand success right now?
I know you're seeing so much.
Unfortunately, this has been an incredibly, I'll just say brutally hard environment for raising capital.
It's, you know, with the economy and the market conditions as they are, a lot of investors have shifted from revenue at all costs to profitability.
And profitability means that you need to have some very strong business fundamentals in place, good unit economics.
And if not profitable today as an early startup, then at least reasonable assumptions and a path to profitability that an investor can rely on and understand that and agree that you would be a good steward of their capital to grow the business.
So investors have a lot of other options over the past 18, 24 months where they could park their money with less risk.
Hopefully that will be changing in the coming 12 months and we'll see more capital flowing into the market.
But what I can say is that there are still deals getting done.
They're getting done with businesses that meet basically four criteria that have never gone out of fashion.
First and foremost, it's about the team and the founder and the strength of that person's experience, skills, personality, etc.
and a whole host of other characteristics.
The product has to be differentiated, the market opportunity has to be good and the unit economics have to be sound.
So those things really have never been out of fashion, as I said, but that's where the money is getting attention these days.
Well, we are going to first of all discuss some of the reasons and examples of why brands do make the decision to shut down.
Monica, I would love to hear from you on the first one first.
So running out of cash is probably the most common reason why brands wind up having to shut down.
And again, the article that you published on nosh.com, I failed but I'm not a failure, speaks to so many of these.
Let's start off with VC-backed companies that can't raise more money.
Obviously a huge problem right now.
So a couple of founders that I interviewed for this piece, they ran alternative protein startups and were venture backed starting out and ran out of cash because it's just the market has been withering.
It's really hard to raise at the same valuation that you raised at maybe a year or two ago.
Michael could probably speak a little bit better to that than I can, but we're seeing down rounds where the money's just not out there and it just became a really challenging environment to raise.
So the two companies that were featured in the piece, Hooray Foods, which makes a plant-based bacon alternative, and Nowadays, which makes a plant-based chicken nugget alternative, and got to a point where there just wasn't any more cash out there and had to cease operations.
And when you were speaking with both of these brands, what were their sentiments?
How long did they hang on for?
How difficult was that decision to shut down?
So for each of them, what are some of the comments that they shared with you that can help paint a picture of what this looks like?
Well, I think in both cases, they had a view of what was going on in the market, and the founder of Nowadays told me that he laid some folks off from the team.
They shut down their food service business.
They tried to conserve as much cash as they could to extend their runway, and they just got to a point where it wasn't happening.
He tried to pivot into K through 12, which would have brought a lot of volume into the business, but just to invest in the equipment that was needed to produce for that channel, the money wasn't there to support that move.
And Michael, I know this is something that you certainly have your eye on as well.
Monica mentioned valuations and how that comes into play.
Is there any advice that you can give to folks who feel like they might be in this position or who are in this position?
To me, it seems like you're up against a wall and there are no options.
Well, let me give you some context.
The Brandjectory focus is seed to Series A CPG.
So that basically means zero to about 8 million in revenue.
So I think I've seen a number of cases where CPG brands are working with CPG investors and non CPG investors.
CPG investors understand that valuation or path evaluation growth, and so tend to seek lower valuations, especially in the early stages, while non CPG investors will tend to offer higher valuations.
The problem is that comes back to bite the brand when they start to work more specifically with CPG investors in Series A or later rounds, because that valuation will, so shall we say get corrected based on the stage and momentum of the business.
So while it's something that we can put a feather in our hat about, it is an important aspect that can create a lot of tension in later rounds if the initial valuations are too high.
And Monica mentioned the down round.
That's where people have to take a haircut on what their investment is worth.
And nobody likes to do that.
Certainly not.
Let's move on to the next point here.
Cogs prices that are rising.
Certainly this was a huge, huge factor during the pandemic, and it's not something that's been completely eradicated, of course.
Monica, what's a good example of this that you have to share?
Cogs prices rising.
In speaking with Kirsten Sutaria, the founder of Wonderlabs Doosie Pots, which was a plant-based gelato alternative, they had learned that they could not be priced any higher than $7 at shelf.
That was the ceiling from which they understood that consumers would buy that product.
And everything, all of their cogs were rising, I mean, from 20% to 200%, to the point where, and they didn't want to compromise their ingredients to deliver a cheaper product.
So they basically couldn't carry on at the price that they were selling it for, and on top of everything else, packaging went up.
So that was when they determined that they needed to move on from the business.
There just wasn't a viable option or a way to sustain.
Michael, what are your thoughts on this one, cogs prices rising?
How would a founder be able to figure out, or what are the questions they should ask themselves to figure out?
You know, should I take a price increase?
Should I perhaps change the ingredients?
I don't know, what are some of the points of consideration that might go through a founder's head with this one?
Yeah, two key thoughts.
One is to remain open to all possibilities and not be so fixated on what your original idea was.
And so if we don't allow ourselves to adapt and question and be curious about what else could be, we get too attached to a specific outcome and we start heading down a road that is not achievable based on how fixed we are in what we're willing to accept.
At the end of the day, founders are trying to create something of value to consumers, help transform the food system, make a difference and an impact on people's lives.
And we might find that it has to change down the road, but we can still have that impact and be successful.
The other thing that I want to mention is when it comes to COGS prices and this need to adapt, I think it depends on where a founder is in their life cycle or where their business stage is.
I know Carl and Kristen and I've known them for many years and they're great people.
And I think that they were working at this really hard and there's a lot of founders that could be in their shoes.
But you get to a point where you don't have the money that you need to continue making changes.
You've tried a number of things and they haven't worked.
And in order to keep going and to keep trying and to keep iterating, whether it's from a business standpoint or a personal standpoint, there has to be a source of funds and a way to maintain a life.
Making these changes early on I think is an easier decision.
But the longer we go down the path and not meeting expectations, not achieving the milestones that we wanted to achieve by certain points, then I think our choices become fewer.
And that's really hard.
Such a difficult decision to make.
Monica, we have one more example from that article that I love to get to.
This one is about bad advice.
Could you tell us about Mighty Gum, the advice they got and then how that led to them shutting their doors?
So I don't want to imply that all third-party service providers give bad advice, but there's a couple of players out there who may not care as much about your business as you want them to.
So in the case of Mighty Gum, the founder was approached by a food service buyer who said, hey, okay, so let me back up.
Mighty Gum is chewing gum that's infused with botanicals and vitamins that are meant to support immune health.
So when workers were returning back to corporate offices in 2021, this broker suggested, hey, why don't we get single serve packets of this gum in corporate pantries and workers will feel a little bit better about returning to work.
Maybe they feel like they're doing something for their immune health.
And so the broker insisted, go ahead and produce your inventory now.
We don't want to wait 8 to 12 weeks.
This is as good of a deal as done.
So let's just go ahead and move forward with production and we'll get that contract over to you.
And basically the guy, to use the founders words, ghosted him.
So never heard back after producing all of that gum.
It was a pack format that he couldn't sell in any of the channels that he was already in.
And so he was stuck with all that inventory and he had put all of his cash toward that thinking he would replenish the other pack format once he sold through that and it just didn't happen.
And the gum expired two years later, couldn't do anything with it.
So that's when he had to shut down the business.
Michael, what's the lesson here?
Is it, you know, wait for a PO?
Certainly don't tie up your money in excess inventory, but the understanding was it wouldn't be excess.
The understanding was that there would be opportunity for this.
Any key takeaways from this one?
It seems like, again, just such a difficult situation.
Trust, but verify.
I can't emphasize enough to get more than one opinion.
And, you know, surrounding ourselves with people that are experts in different functional areas and have broader views of the marketplace that are outside of the narrow scope that we're looking at it, we meaning founders or that, you know, specific service providers looking at it, go to another trusted person in another type of organization.
You know, so if you're talking about a broker, I'm just making this up, but go to an attorney, go to a marketing person, go to another broker who might be a friend, and just, you know, ask for their perspective on it.
Certainly another example of why having a solid network can be helpful in so many situations.
So in addition to running out of cash, we also have poor product market fit, the burden of legal and regulatory compliance requirements.
That's a big one.
The team, so having the right people on the bus, and then external factors like the economy, for example, global supply chain.
Michael, do you have any thoughts that you want to expound upon for these talking points or examples that you'd like to share?
Two brief ones.
Product differentiation is critical.
Coming to market with something that we're good at making is, if it's not differentiated from what's on the market, then it's going to be really tough to compete, really tough to grow.
On the regulatory side, I would just say, I'm thinking a few years ago when hemp was approved or passed as part of the Farm Bill, there was a lot of products that came to market with hemp or CBD in it.
And so there was a rush to create a new market.
Consumer skepticism was there, and the regulatory environment was also uncertain.
And so that led to a big rise and a big crash on that segment.
And so that's one example, but another example is simply integrity of ingredients and supply and consistent supply, but also making sure that it's being tested and it's high quality, etc.
I noticed there's a couple of questions in the chat.
So one of the questions is about investors moving up market from the earlier stage companies into later stage companies.
And first of all, I think the reason why investors are moving up market is because it mitigates risk.
The companies are in the market longer, they have more traction, more proof points, and so those investors are looking for less risk.
And so there are always people, high net worth individuals, whether they're executives, former founders, professionals like doctors, lawyers, et cetera, who are looking to invest in great people and great products and great companies and great businesses.
And so at the end of the day, it's just simply going to take longer to keep dialing and calling and asking for referrals and using your network and somebody else's network and getting those warm introductions across a whole variety of people.
It's just the nature of the beast right now to have to make all those calls.
And then the other question is about partnering opportunities that may be available with peers that are also in a similar situation.
I suppose that is such a situation-dependent scenario that there have to be, you want to look at the risks of both businesses as well as the synergies and the upside.
And what it might mean to combine forces and whether or not there's something there.
I'm happy to talk with anybody who might have that particular scenario in mind.
But there's a lot of legal and structural questions that need to be addressed for that to work.
Nick, thank you so much for those questions.
And Michael, thank you for taking the time to answer those.
And just for Nick and for anybody else on this call who does want to continue a conversation with you, Michael, is the best way to reach you on LinkedIn?
Is there a website you'd like to share if folks want to chat a little bit more about this?
Sure.
I am on LinkedIn.
I'm also at michael at brandjectory.com.
Excellent.
Thanks again, Nick.
All right.
Let's move on to what to do about all of this.
What are the factors that founders should be monitoring to have a realistic idea of business health?
And I guess I'm hoping that if they keep these in mind, then perhaps the decision, perhaps it could be made earlier, perhaps it could be easier to make, take some of the emotions out of it and be able to look at the facts.
Michael, what are some of the important metrics that founders should be monitoring to understand where their business health is?
The first top three are cash, cash and cash.
A company has to understand their cash position.
They have to understand their burn rate, which means how much money are they spending above and beyond what they're taking in every given month.
And they have to understand their cash conversion cycle.
And what that means is that when you spend a dollar to buy inputs to create the product, it could be three, four, five, six months before you get paid for that product, you know, that you've shipped to a finished product that you've shipped to a wholesaler or retailer or consumer.
So understanding what those timelines are helps you understand how much money that you need to float before you get paid, as well as just from a burn rate standpoint, that's a whole topic in and of itself.
But, you know, there you need to examine what you're spending money on, whether or not it's a productive expense, how impactful that expense is, whether or not you're meeting benchmarks or, you know, you're blowing them away or you're way under.
These are all things that working with a good financial advisor can be very helpful at getting those benchmarks straight up front.
We know that there's going to be a lot of investment in the early days and years of a brand, you know, to generate consumer awareness, generate trial, get onto the shelf, et cetera.
And so it requires a lot of money.
In fact, I've been asked a number of times, you know, how much money should I plan to spend to get my product launched and in market?
It's not uncommon for that number to be 200 to 250,000 to get, you know, the product developed, launched and in market for the first year.
So and I think that if a lot of founders knew that that's how much money it was going to take going in, they may have reconsidered their decision.
Absolutely.
And of course, there are no hard and fast numbers for any of these things.
You know, if the answer is there isn't a number, then I completely understand.
In terms of gross margin, for example, is there a general gross margin that brands should be able to hit, you know, at least out of the gates to have an idea of whether or not they're going to be safe or not?
Well, I don't know about out of the gate, but I'll give you the targets.
In food and beverage, it's typically 40% gross margin that's after tradesmen.
And in nutrition, it's typically personal care.
In nutrition, it's typically 60% and above.
Those would be targets slash minimums for the business to have sufficient net revenue to cover expected expenses that are going to drive the growth that the company is looking for.
So in the beginning, out of the gate, you're not generating those kind of margins.
Costs are high because you don't have the scale to get efficiencies.
There's a lot of forward investment from a trade spend standpoint and a marketing standpoint.
So the revenue is not going to be there to cover those different expenses.
So you have to have capital from some source, whether it's yourself, friends and family or other investors.
And you mentioned setting benchmarks.
If you are new to CPG, if you have a product that may not have a concept that hasn't necessarily been proven out yet, what's some of your best advice to founders on how to set benchmarks in what might be new territory?
Start slow.
Get your proof at a small scale.
Rather than going too far, too fast, too soon, it's okay to start with a few stores and a few states or a few cities.
You have to be able to support what you sell.
Trying to go national or too broad, too quickly means that you're diluted both in attention as well as what you can support.
By the way, if you can figure out what works in a small geography or a contained channel, the story of taking that to an investor, of saying, I've achieved X, Y and Z in this area, and I need capital to then multiply this effect, the investor is going to get very, very excited about the opportunity knowing that what you've achieved is in a subset of what could be achieved.
And it's a matter of math at that point to expand.
Math and effort, excuse me, math and effort.
Math and effort.
Makes perfect sense.
Monica, I'd love to turn the conversation back to you.
We started this conversation with the idea that it's not necessarily all doom and gloom.
So you laid out some very good examples of brands who did wind up shutting down.
But I know that for at least some of them, they've kind of started up again.
Can you talk us through some of the bright spots with any of the brands that you mentioned earlier on in the conversation?
Sure.
Well, I think one of the important points that was so eloquently stated by the founder of nowadays is that we really need to reframe success and failure.
Success and failure are not binary.
And his point was, if you have fed people well, if you raised one dollar, if you were in business for multiple years, that's a success.
Just because you couldn't continue due to market conditions, don't call it a failure and don't internalize that as a failure.
And so I think having a healthy separation with mental health and with the realities of the business is important.
A lot of them talked about having a support system really help them navigate those challenges after shutting down.
And in the case of Kirsten Sutaria, she doubled down on her consulting business after shutting down the ice cream business and is thriving.
She loves it.
It's been great for her.
She sometimes considers starting up a new CPG company in the future, but for now, she's very happy with what she's doing and described it as sometimes such a vibrant light can exist beyond the doom and gloom of the day-to-day grind.
And then the founder of Mighty Gum is actually in the process of starting a new CPG business that will be a little bit less cost-intensive than chewing gum, leveraging all of the learnings that he took from the five years that he operated that business and going forward in just a better spot.
Thomas Edison said, I have not failed.
I have not failed.
I've found 10,000 ways that don't work.
We have to celebrate the wins.
We have to recognize the accomplishments that we have made.
It's really hard to start and succeed in business and particularly in CPG.
I mean, it requires a lot of things to go right.
So I think that entrepreneurs are a special breed, and it's hard to say no, and it's hard to lay something to rest.
But sometimes, if we've left it all out on the field, then that's one thing.
But I was talking to a founder actually just a couple weeks ago, and she was, let's just say, not in a good place mentally and emotionally about the state of her business.
And after talking for a little while, she determined that she still had options she wanted to try.
And she was not ready to say, I'm done.
So I think there's a difference between being ready and feeling ready, and she wasn't feeling ready.
And it turns out a week later, she called me and she said, guess what?
I found $100,000 from an investor.
So they gave her another lifeline.
I think a lot of these founders feel like they're needing to be subscribed to this hustle culture and be constantly grinding it out at the expense of their mental and physical health.
And I think, yes, you can conduct a rational analysis of the business and look at these metrics and make a scientific conclusion about whether you should continue.
But I think there's also other factors at play talking to the founder of Mighty Gum.
He's a single father of a young son, and he said, you know, I want to give him some stability.
He bootstrapped his business, and he felt like, you know, I don't want to wake up every day and say, do I fund this R&D round, or do I pay rent?
So, you know, I think that there are a lot of factors to consider beyond, you know, your margins and cash conversion cycles and everything else.
I mean, not to say that that's not important, but it's just so much bigger.
Michael, is there advice that you like to give founders around how they can take care of themselves better?
Have you seen examples of founders who are doing it well?
I certainly understand that it's really difficult over the course of a busy day for an entrepreneur to take time out to do whatever helps.
You know, is it meditating, is it exercise, is it, you know, calling a friend?
What advice do you give founders who are struggling with figuring out what the right balance is between kind of self-care and mental health and keeping their business going?
Deepak Chopra once, I saw him speak one time, and he said everybody should be meditating once a day.
And if you don't have time to meditate once a day, then you should meditate twice a day.
But it comes to a point where, you know, if you're not taking the breaks to give yourself the chance to recharge, and that could be, you know, 10, 15, 20 minute breaks during the day, standing up, walking, getting some sun, getting some fresh air, eating, you know, a decent meal, getting enough sleep, exercising, getting your blood and your oxygen and your blood, and, you know, making time for the relationships that are important to you, that recharge you, not only that, you know, give you something down the road to work for, there won't, you know, there just won't be anything left.
And then you're dealing with a situation where you've got to repair a bunch of things that have broken or burned down because of the neglect.
What are we doing this for, you know?
Is it for, you know, the gold star and the recognition?
Or, you know, are we trying to have an impact?
And guess what, if we're trying to have an impact, how about an impact on ourselves?
Everything that we say yes to, we're saying no to something else.
And you can only say no to yourself so many times.
So good.
That was reflected in one of the comments that Kirsten had said to me, which was your chip brand or your ketchup brand or your cookie brand is not worth your peace of mind or your sanity.
And I think at the end of the day, we get so tied up in our careers and our businesses and what we do for a living that we neglect our actual lives.
But if there's a bright spot, perhaps it is that we're all talking a little bit more about mental health and perhaps subscribing less to, Monica, what you described in the NOSH article is the hustle harder culture at the expense of mental health.
I just want to add too that, you know, we do need to surround ourselves and be part of tribes and communities that we can relate to and who can hear us.
And that could be, you know, communities within the industry itself.
It could be faith-based communities.
It could be other, you know, other communities that we feel close to that we can trust people, we can open up to them, we can feel vulnerable and not feel judged, whether it's with these communities that I mentioned or reaching out and finding advisors or experts to bounce ideas off or to ask somebody to be a mentor, or you know what, professional therapy is remarkable.
And whether it's business coaching or therapy, you know, Sarie Kimball is a good friend of mine and a great coach, and she is remarkable at being able to cut to the core of a question, you know, of an issue, what might be the drivers.
By the way, coaching, you know, coaching is about forward-looking.
Therapy is about backwards-looking, trying to find, you know, drivers and conditions and past experiences, et cetera.
But guess what?
That's what we are.
We are an accumulation of our past lives and experiences that are driving our decision-making today.
And so if we're not finding that we're happy with where we are, then we need to start to try to figure out how do we get past that.
Michael, one more time.
I'll start with you.
What's the best way for folks to get in touch with you?
LinkedIn and michael at brandjectory.com.
Thank you so much.
Monica, how about you?
LinkedIn, also Instagram, and M-W-A-T-R-O-U-S at bevnet.com.
And what's your Instagram handle?
Oh, it's my full name, Monica Watrous.
All right, fantastic.
Well, thank you both so much for joining Community Call.
This has been such a pleasure.
I appreciate it so much.
Again, for folks who may not have had a chance to read the NOSH article last week that Monica wrote.
It's called I failed, but I'm not a failure, and it's available on nosh.com right now.
That concludes another episode of the Community Call podcast.
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