NOSH Live Winter 2022 Day Two Recap: Dyrdeck’s Machine Method, Yasso’s Successful Brand Growth

Better-for-you foods made with functional or upcycled ingredients was a common theme at NOSH Live Day 2. Speakers on Friday brought up the importance of reaching consumers who are shopping for natural products that are good-for-you and good-for-the-world.

Rob Dyrdek: “Raised By Entrepreneur Wolves”

Ex-professional skateboarder and TV personality turned CPG investor Rob Dyrdek took to the stage Friday to discuss how he balances his investment strategy with his life philosophy.

“The same way you do a five-year projection on the growth of your business, you should have the same design and focus in your life, so you will grow your business and your life together,” Dyrdek said. “When you find success in business, you find success in life.”

In 2016, Dyrdek launched his venture creation studio Dyrdek Machine, which has invested in 16 brands and exited six companies so far. The portfolio runs the gamut from apparel to wellness and beauty to food and beverage; the latter group includes Muertos Coffee Co., THC-infused beverage brand Leisuretown, Outstanding Foods and functional snack brand Mindright.

Outstanding Foods produces dairy-free, plant-based cheese ball snacks and Mindright makes nootropic-infused snack bars and chips that promote brain health.

Even though Dyrdek regularly wakes up between 3:30 am and 5 am, he cautioned entrepreneurs that maintaining energy and not “running on the edge” will provide more clarity to building a business.

Many entrepreneurs can run into the problem where they fall in love with the idea of their product and assume that consumers will automatically love it too, he said. The key is doing the work to understand why a consumer will connect with and see value in a product.

Most important to Dyrdek’s investment strategy is connecting with the founder and finding products that have the highest probability of success. This starts with finding partners who are focused on a business’ fundamentals.

“Creating a business is the most exciting, incredible thing in the world – unless it doesn’t work,” he said. “Then it’s a nightmare. An ongoing, chaotic psychotic nightmare that you hang on to until you finally lose belief and give up.”

Yasso: A Three-Phase Approach To Building A Successful Brand

Frozen greek yogurt maker Yasso’s CEO Craig Shiesley shared how he has made an over-30-year career helping build sustainably-grown CPG food businesses. His brand-building strategy follows a six-point plan: Brand Power, Loyal Consumer Base, Distribution Upside, Industry-Leading Margins, Growth Potential and Strong Fundamentals.

Shiesley laid out Yasso’s progression to becoming a $240 million company in 2021. It followed a three-phase approach utilizing his brand building strategy.

At Yasso, Phase One was all about laying a foundation for the brand’s value proposition to consumers. The company’s founders Drew Harrington and Amanda Klane saw a wide space in the ice cream category for “snacking without compromise,” Shiesley said.

The brand was able to attract a loyal consumer base with a powerful brand in Phase One and move into Phase Two with “an inch wide and a mile deep” distribution strategy. It is in this phase that a brand must show patience and be deliberate in its growth to maximize velocities, Shiesley said.

The third phase is where a brand can utilize its margins to maximize growth potential through innovation and prove its strong fundamentals.

Shiesley admitted that it has not always been an easy road. He has “a garage full of failed launches” but one key to building a strong brand is determining when the right time is to scale the business.

CFO Panel: Driving Financial Margins

Seasoned CPG chief financial officers Elizabeth Carter and Monisha Khushalani joined NOSH editor Carol Ortenberg to talk about the most important financial fundamentals of a successful business.

Both former CFOs are currently transitioning from their former jobs into new roles. Carter is starting a new role as president and COO at grass-fed beef snack maker Chomps. Khushalani recently left her role at Ollipop as CFO to become an advisor.

Khushalani and Carter both drove home the importance of setting realistic financial goals while building towards positive margins. If a company’s margins are strong, it will influence investors to fund further growth down the line and eventually lead to successful exits.

SPINS: Understanding Brands’ Core Consumer

Consumers are shifting their healthy food choices from taking the bad out to putting the good in with increased buying behavior focused on products with added health benefits, explained market research group SPINS.

Senior market insights analyst Scott Dicker noted that naturally positioned snacks are growing at 10.5% overall. The jerky/meat snacks and cookies/snack bars categories are showing promise, growing at 15% in the 52-weeks ending October 30.

Yet, with the continuing rise of better-for-you foods, brands should not ignore conventional retailers, coached SPINS senior director of strategic partnership Caroline Davidson. “What’s really important is you’ve got to have a different strategy for each entity that you sell in,” she said.

Bridging The Gap From DTC To In-Store Retail

Sana Sano Growth Advisors CEO Kirsten Hogan brought her nearly two decades of experience formally working at UNFI to guide brands through the difficult process of moving a business from the online channel to brick-and-mortar retail. The key to success is based in understanding product assortment, positioning, pricing and promotion.

There are different metrics that brands need to be aware of when making the jump from ecommerce to retail sales, she said. Understanding market data and prioritizing innovation over time will help food products move deliberately onto the shelf. The key is converting online success to retail scale without cannibalizing what was working.

“If you do nothing else, read the whole contract,” Hogan said in closing. “You may have just signed your life away. You don’t know unless you understand what you’re signing.”

Navigating Ecommerce Grocery Retail

James Ren, head of food merchandising at Thrive Market, and Misfits Market senior director of grocery Brandie Miller talked about how building an ecommerce retail market is about understanding consumer needs.

Both merchandising buyers highlighted that the online retailers sit in a very unique place of offering new and innovative products that sometimes get lost in conventional grocery stores. At the same time, both businesses aim to provide a more affordable and accessible shopping experience to a new generation of consumers.

Lessons Learned From Building A Brand The Second Time Around

Former founders Matt Clifford and Suzie Yorke closed the second day sharing advice from founding their first brands and implementing those lessons in their second opportunity running CPG food businesses.

Yorke formally founded keto bar brand Love Good Fats while Clifford was behind upcycled snack brand Barnana. Both said that learning from past mistakes and the “naivete,” as Clifford put it, of first founding a brand has been integral to moving forward in the industry.