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The Barcode Podcast is presented by Titanium CPG Insurance. Titanium protects forward-thinking consumer brands with a range of commercial insurance products and risk management services designed specifically for natural and organic food and beverage companies. Learn more at titaniumcpg.com

We hear the stories of entrepreneurs coming up with a brilliant idea for a product, getting it to market and exiting to a large food conglomerate or private equity firm for millions of dollars and think that is always the way things go. The truth of the matter is, it’s often much more of a roller coaster and far different behind the scenes than we realize.

Today we’re talking to Caroline Freedman on the podcast. She and her co-founder Lauren McCullough came together 10 years ago to found NurturMe, a baby food company based in Austin, TX. They exited last August, and in this conversation with Caroline, she walks us through the good and bad, hard and exciting of taking an idea all the way through to exit. 

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 BEN                           Welcome to The Barcode Podcast. My name is Ben Ponder and I’m your host and I want to remind everybody that we are presented by Titanium CPG Insurance. Titanium protects forward-thinking consumer brands with a range of insurance products and risk management services that are designed specifically for natural and organic food and beverage companies. You can learn more online at titaniumcpg.com and I’m really excited today to have Caroline Freedman as my guest and welcome Caroline.

CAROLINE            Thank you so much. I’m excited to be here.

BEN                           Yeah, so glad you’re here. We’re going to talk about baby food. We’re going to talk about startup life and you have a unique perspective because over a period of about roughly 10 years, you really had the dream on some level of starting from scratch this NurturMe baby food company and you went all the way through an exit last year.

                                    So we’re going to talk through just that roller coaster journey and all of the twists and turns that are super interesting. So, before we do that, best meal ever go.

CAROLINE            Best meal ever. Okay. This is a tough one because just because obviously, but it was interesting when you first asked, all the meals that came to mind was more about the company and the setting than it was the actual food and so I kept kind of thinking like, “What was that meal that I have with my husband that was the best?” Or in fact, the celebratory meal that Lauren and I had when we sold the company was a contender.

BEN                           And it’s because it’s not just about the calories that you’re ingesting, it’s about the moment, the memory and the content.

CAROLINE            The moment and the memory and the company and the significance.

BEN                           Right.

CAROLINE            But of course, it’s heightened. So, Lauren and I for example, we had our celebratory dinner at UCI.

BEN                           That’s a great, yeah, celebratory place.

CAROLINE            Obviously one of the most fabulous meals, but one thing that comes to mind though is a meal I have with my family. Just within the last year, we tried to take a ski trip with the kids. It was a failure. Everyone got altitude sickness, but we were in Santa Fe and driving down the mountain after everyone was puking during ski school.

BEN                           Nice.

CAROLINE            We came across Ten Thousand Waves. Have you ever heard of that place?

BEN                           No, no.

CAROLINE            Oh my gosh.

BEN                           So it’s in Santa Fe proper.

CAROLINE            It is in Santa Fe proper, on the foothills of Ski Santa Fe and it is just this like mecca, fabulous. It’s actually a spa, but there’s a Japanese restaurant on the premises.

BEN                           You’re clearly a sushi person. Yeah.

CAROLINE            But we just, after this disastrous morning, we came into this warm, wonderful Japanese restaurant. We sat on the tatami and were seated at this low table and had warm drinks and then bowls of soup.

BEN                           Tummies were starting to calm down and heads weren’t spinning and yeah.

CAROLINE            And the food was wonderful and it was like soothing and just being all together and then out the window you could see the snow and so it turned this this day dramatically around.

BEN                           So you were seated at the low tables? It was the first time the kids had ever done anything like that?

CAROLINE            Exactly.

BEN                           That’s pretty unusual in any American setting, right?

CAROLINE            Yes. So just, I mean, for the food and just the whole experience, that was one for the books.

BEN                           That’s beautiful. That’s really, really great. So, you now have three daughters?

CAROLINE            Correct.

BEN                           Right? But tell us a little bit about the Genesis. So, you were at out of school, you went to work initially selling and then doing some other stuff at Dell.

CAROLINE            Correct.

BEN                           And then how did you find yourself starting a baby food company?

CAROLINE            Yeah, so I always wanted to do something entrepreneurial. I think if I were a kid, I would have answered that question as you I want to create a brand, I want to create a company and I want to write. Those were kind of my two dreams as a kid and as you said, straight out of school, I ended up at Dell with the headphones on, taking orders from people, ordering computers in their homes and that ended up becoming a 10-year career where I kind of moved in and out of various disciplines there.

                                    And I was very grateful for my experience during those years. However, it was extremely corporate, and I always sort of continued to dream of doing something on my own, but I just was waiting for this brain wave to hit me.

BEN                           Even back then, were you an idea person? Were you constantly kind of thinking of things like, “Oh, is this the idea? This isn’t it.”

CAROLINE            Yeah, I don’t know. I actually did just sort of organically happen at last which is when I got pregnant with my first daughter and I remember the moment, actually, I was sitting in my downtown condo. I was like looking up on the computer, what do you feed infants and how does this process start? And of course, it’s overly complicated for new parents to start it at this time.

BEN                           And first-time parents, I mean, everything is life or death. The more kids you have, the more lax you get about everything.

CAROLINE            Exactly. I know, my poor third daughter, but for the first I was doing all this research and trying to figure out like when you start introducing foods and how that process works and in doing that, I kind of got introduced to the baby food category which at that time, over 10 years ago now was still really Gerber. It was still pureed foods.

In glass jars that I was like, “Huh, well there seems to be an opportunity here because this is old fashioned and me and my friends, this is not the kind of product that we would want to feed to our kids.” Obviously, I’m interested in organic and obviously, I think this whole, there’s a more interesting way to package these foods.

                                    So that was sort of the Genesis and then as I began doing some research about other competitors aside from Gerber, there weren’t many and so I just sort of thought I had my aha moment.

BEN                           And at that point, what year is this?

CAROLINE            I was pregnant in ’08.

BEN                           Okay. So, my assumption is that maybe Plum Organics was the only thing out there that was even beginning to be this next generation of baby food, right?

CAROLINE            Well, of course now they all … Their claim to fame is that they were all the first, but it was Happy and Plum and, in the UK, it was Ella’s Kitchen. All of whom came about around the same time. They all take credit for the form factor that took hold which is obviously the squeeze tube.

                                    But Plum, you’re right. They, in our due diligence, they were the one brand that bubbled to the top, but even then, they were owned by the original founder who sold it out kind of in those early years and that’s when it really ramped.

                                    But yeah, I mean we sort of saw, okay, there’s a few other moms who see this opportunity the same way we do. We actually launched with a product that ended up, we had to pivot away from about two years in. But what we were trying to do initially was create an alternative to the jar by having dried organic fruits and veggies that you reconstituted with liquid to create a puree consistency.

BEN                           Okay, sort of like the powdered, rice cereal stuff that they used to have.

CAROLINE            It is exactly that. Yup. And kind of served in these single sleeved, paper satchels. So, it was more environmentally friendly. Breastfeeding moms could use their breast milk. So there were all sorts of benefits, but ultimately, long story short about kind of how we ended up doing the pivot was the squeeze tube form factor came about right as we were getting our initial product line onto shelves that the convenience just trumps what we were doing.

BEN                           Yeah, ready to eat, ready to use is a huge, huge deal. Let me back up half a second.

CAROLINE            Sure.

BEN                           How did you meet Lauren?

CAROLINE            Yeah, yeah, okay, so that is another part of the story which obviously is key. So, I had my idea, but I was pregnant in this very secure job.

BEN                           Which is hard to leave.

CAROLINE            Hard to leave and also, I’d had a lot kind of about to happen and it wasn’t exactly the most optimal time to decide to start a company, but for whatever reason, I shared this idea that I was being super protective of with Lauren, who I had newly met.

                                    So, we were just barely friends and she was sort of this hippie Bohemian type who was a culinary arts teacher. Didn’t really have any business background, but she did happen to be former roommate of Clayton Christopher.

BEN                           CPG success guru person based in Austin.

CAROLINE            Correct. But at the time, he had launched Sweet Leaf Tea, his first venture, but it was still, I mean, he had gotten enough traction that I think he possibly had had an initial deal with Nestle but was not that far along. So, but anyway, I mentioned that because when I mentioned this idea to Lauren, she was sort of undaunted, about, of course, let’s do this because she’d seen Clayton at his dining table with his buddies having focus groups and taste testing samples.

                                    So, when I said, “I have this idea for a baby food, and I have no idea the first thing to do.” She said, “Well, let’s taste test samples and let’s have focus groups. Let’s follow all the steps and then of course, the other thing that I have to mention is how generous Clayton was to not only give us his own advice, but then he referred us to a ton of people in sort of what was the initial, I think, the initial kind of generation of CPG experts in town who were mentors to us all throughout the journey.

BEN                           Bryan Goldberg and people like that.

CAROLINE            Dan Castella all those guys who you know are continued to be friends and ended up getting very involved in NurturMe.

BEN                           Yeah, that’s awesome. Okay. So, you met her, she had very complimentary skills and background that maybe even made you feel like it was a little bit more possible?

CAROLINE            I think the Clayton angle was more helpful and I don’t think that that was something that I necessarily was pursuing was that connection, but I liked her. But honestly, we’ve always said like we were irresponsible about going into business together.

BEN                           It’s pretty typical.

CAROLINE            Yeah, I mean, but luckily, we weren’t best friends, we were just sort of acquaintances. So, there wasn’t a ton on the line, there wasn’t a lot to lose I guess and so we both were just enthusiastic, and we had not only complimentary skill sets and professional backgrounds but various different interests.

                                    So, she’s a real detail-oriented operator who was very interested in the food and the ingredients and that whole aspect of it. While I was more interested in building a business.

BEN                           The business and the sales and the yeah.

CAROLINE            Yeah, and what does that look like and how do we create this thing and so I sort of took this strategic portion of our initial work while she did a lot of the more tactical stuff.

BEN                           Yeah, okay. So how did you know in those first two years or how did you make the decision that the reconstituted thing wasn’t working? Because again, you recognized, “Oh, everybody’s moving to baby food in pouches.” So that’s one thing, but then that’s a huge shift, right?

CAROLINE            Yeah.

BEN                           And it means I assume changing your supply chain, obviously changing your packaging, changing the fundamentals of your product and company, changing the economics of everything. Was that like a: “Yeah, this just kind of isn’t working. Let’s try something else,” or was it a really like arduous decision?

CAROLINE            Yeah, I know. We were very deliberate about it and partly because not only did we love the initial product and it wasn’t only us, I mean, we were getting a ton of yeses from retailers who thought this is super differentiated which of course is a huge thing.

                                    It was super innovative. It was well-branded, but I stopped short as I was saying before the second thing that we learned that was not working was the fact that there was a lot to explain to the customer and as a new brand, you really have to rely on your packaging and your messaging to mostly do that.

                                    You don’t have a ton of budget to do all kinds of marketing messaging. So, you really have to have it succinct on your packaging and it was no fault of our brand director.

BEN                           And you don’t want to make people work too hard to figure that out.

CAROLINE            And that’s what we were doing. There was too much of a learning curve where a mom in the store was having to read. It’s environmentally friendly and I can mix in my breast milk and it’s organic and all of these things. Plus, we also started saying you can mix this into foods like mac and cheese and packet for your toddler if you’re wanting to sneak in fruits and veggies.

                                    So, we had a lot going on and it became confusing and the learning curve was too steep when the squeeze tube was just a quick and easy grab and go and it became kind of a no brainer. So those were the two things we ultimately just said. That’s what we’ve learned is not working but, we were sort of reticent to just abandon the original concept partly because we loved it, but we also had investor backing, we had retailer backing and we were getting a lot of encouragement from those parties, but ultimately, the economics were what dictated the decision.

                                    It was like, “We are getting kicked out of places because we’re not maintaining velocities and because of our velocities that the retailers are now beginning to ask about.” At first, when you don’t have that history, you can rely on branding and innovation and those types of things.

BEN                           And your charisma.

CAROLINE            And your charisma. Exactly, but when you’re actually on shelves and you actually have velocity to point to, that then becomes your main …

BEN                           Or lack thereof.

CAROLINE            Or lack thereof, that becomes what the buyers start asking about and then it prevents you from getting additional distribution. And so we ended up having to make the pivot and there’s one aspect of being a CEO and founder where you want to have conviction of your original product and have the confidence, I guess to kind of say, “I’m getting advice from certain things, but I feel strongly enough that this is the right path.” But then on the flip side of that, you also don’t want anything to be too precious and you also want to be nimble.

BEN                           Right. And you don’t want to be obstinate either.

CAROLINE            Right. exactly. So just to say, we were aware of both those things and so the decisions sort of unfolded over a long period of time and what we decided was, “Okay, we’re going to pivot in a new direction and we’re going to do it on the basis of some success that we’re seeing.”

                                    So, of our original line, we introduced quinoa in response to customers. They started saying, “This fruit veggie diet is a very brief period of time. At some point I start needing to introduce protein.” So, in response to that, we added quinoa.

BEN                           So high protein ancient grain.

CAROLINE            Exactly.

BEN                           Mm-hmm (affirmative).

CAROLINE            We took the time, it was a little less known, but was beginning to trend and we were really one of the first to introduce it into one of our SKU’s and all of a sudden we had an outlier. So that was the one SKU that started kind of actually showing signs of life and so when we decided to pivot, it was by following quinoa’s lead. And one thing we did that I think was a good decision was actually not immediately move into a squeeze tube where we were going to start duking it out with a lot of the brands that we’re seeing a lot of early success. We said, “That space in this category is too oversaturated.”

                                    But there are other subcategories where we can bring quinoa and really differentiate ourselves. So, cereal for example is like the first stage of baby food and so we launched first with a quinoa infant cereal. We sort of stayed out of the pureed squeeze tube space for a time.

BEN                           Because everybody was going after that.

CAROLINE            Because that was dominating the category and it was strategic because we knew that we were up against a very competitive space, but it also of course was a disadvantage to not have any product offering in this kind of significant space of the category.

                                    But we bookended that subcategory by having the first stage cereals and then by having some toddler snacks that were quinoa based and then when we started building our business and our brand on some higher velocities and some good differentiated products, we could explain ourselves.

BEN                           Were those toddler snacks in the kind of traditional, cylindrical tin kind of things?

CAROLINE            We had all kinds of things. So we didn’t ever do a puff product, but we did do crackers and we eventually did cookies and we just sort of kind of stayed in an extruded snack where a lot of the competitors were using rice based items or wheat based items and we could say this is much healthier being quinoa based.

                                    And then eventually when we did have enough traction in those subcategories is when we filled in that we kind of bridged the gap by introducing a squeeze tube line that was also ancient grain based. We’ve stopped pigeonholing ourselves by only offering quinoa products.

BEN                           Right. So other ancient grains.

CAROLINE            Amaranth.

BEN                           Yeah, all that kind of stuff. Okay. So how did you two learn about, what’s the process to go from understanding how to make a quinoa-based baby cereal which is a dried kind of flaky, powdery, flowery thing to a squeeze pouch that I assume is kind of like a retort pouch or something along those lines. It’s a different manufacturer, different supply chain. How did you learn about all that?

CAROLINE            I really, I give Lauren credit because she ended up really owning our supply chain management as the foodie of our duo. That was sort of what you naturally gravitated towards, but you’re exactly right. We ended up having multiple co-manufacturers, multiple co-packers and ultimately, a to complex supply chain actually.

BEN                           When did you realize that?

CAROLINE            Well, when we were way far down a path, by the time we had a SKU lineup of 20 plus items, we had three distinct families of four at one time that were being manufactured at various points across the country and so as we got to that point where we had enough volume and we had enough distribution that we could optimize our assortment and be a little more cost-effective and efficient from a production standpoint.

                                    Without wanting to cannibalize our cereals, which as one example was one of our strongest lines. You don’t want to create too many SKUs within that subcategory that you’re going to start cannibalizing some of your more popular ones. But we did just end up saying, “Instead of having 25 SKU offerings, we’re going to offer significantly less than that and these are our top performers.”

BEN                           So you guys were early movers, not the first, but early movers in the new wave of baby food companies and while you’re building your business, there’s just a crush of new entrance. Right?

CAROLINE            Correct.

BEN                           How did you navigate that? Because you weren’t the first, so you can plant your flag there.

CAROLINE            Yeah.

BEN                           But you certainly weren’t the hot, new shiny thing either, right?

CAROLINE            Totally, yeah.

BEN                           So how did you make sure that you kind of stayed the course and continue to have the kind of differentiate yourself from others and not get kind of outflanked by new entrance? How did you approach that?

CAROLINE            Yeah, we always tried to approach it by having something we really could hang our hat on as a point of difference because ultimately, all those squeeze tube brands kind of became known as all those squeeze tube brands. There were top three or four brands that I’ve named that were sort of known for those particular products.

BEN                           Mostly fruit and veggies.

CAROLINE            So, we just stayed sort of scrappy and very nimble where we kept sort of evolving the way we talked about ourselves, even though we were staying in the same vein. We did officially move away from the dried powdered food we launched at, but once caught on as the quinoa-based brand, we sort of talked informally about offering chemo for baby, being that brand.

                                    We never trademarked it. We never put it on packaging. And then one of our investors actually pointed out to us, “This has legs, we’re seeing the economics. We see your financials and we know you guys are doing something different that customers want and they like, but from a growth standpoint and from an IP standpoint, it’s not very protectable to just say you’re going to create all the products that are quinoa based because anybody else can do that too, but what, what you can start talking about are quinoa’s attributes and the fact that it’s hypoallergenic and it’s naturally gluten free, it’s easily digestible.”

                                    So while staying with quinoa which as I said, we eventually kind of wanted to give ourselves a little more of a broader palette to work with, we eventually talked about it as ancient grains, but then we did trademark the slogan, the tummy friendly brand and we really ended up saying any further items we develop will have an ancient grain basis and it will also always be free from certain allergens, it will be easily digestible. And also, the category and industry, not even the industry, but consumer preferences. We’re starting to migrate towards specialty diets.

BEN                           Very much so.

CAROLINE            And so we were just trying to stay aligned with that.

BEN                           Yeah, I know, that makes all the sense in the world. So, in the beginning, it’s just the two of you, how do you make decisions about how to build your team at the right time? Right? Because there’s always this push and pull where you need to build some capacity ahead of growth.

                                    But then if you build that capacity too quickly, you can get yourself in all kinds of different trouble. So how did you approach that? Did you say, “Okay, we definitely need to hire somebody in this department. What was your approach?”

CAROLINE            This was a little bit of trial and error and I wouldn’t say we necessarily did this correctly. In fact, one piece of advice that we got really early on from Clayton that I remembered and I look back on now is something we should have taken more seriously is when he said, “Your top five priorities right now need to be sales, sales, sales, sales and sales.”

                                    And this was in our early days of course when we were getting all distracted by the PR tour we needed to do and the packaging and our website, we wanted to design and of course, some of those things were basics that we needed to put in place.

BEN                           But sales is how you pay all that PR stuff.

CAROLINE            That’s exactly right. And so, I say that because we were too late to hire enough sales support and I think we would have experienced growth sooner if we had hired sooner, but the other question you have as founders is for how long does that stay on your plate because there is a lot of value and being the face of the brand and establishing a relationship with a new buyer at a very important account. So, we maintained that actually all the way through. Some of our largest accounts were always ones that Lauren and I individually owned.

BEN                           Right. And salespeople tend to be some of the more expensive people you can hire too which is a scary thing when you’re early stage and don’t have a lot of extra cash.

CAROLINE            Yeah. So, I would say to answer the question by saying one of the first hires we did was actually a part time admin and the basis for that of course was we’ve got a portion of non-value-added work just to take off our plate so that we can focus on sales and all the other important things.

                                    The next was actually a marketing hire, it was one that we did earlier on, it was because it was a little bit of a skills gap that we had between Lauren and myself and so that was a little bit more of a forward spend.

BEN                           You recognized that. Yeah.

CAROLINE            The fact that we needed that skillset that she and I didn’t particularly have, but it was a forward spend that you were going to invest in that in order to generate sales, but then eventually built out our sales team to have over many years we ended up having East, West and Midwest reps and then they of course, each managed a broker network in each of their regions and that’s how we got set up.

BEN                           Yeah. That’s super helpful. Was there a moment in the early days of NurturMe where you thought, “This isn’t going to work.”

CAROLINE            Oh, like 10 times a day. Yes. I mean that was a reality we lived with the entire time.

BEN                           Okay, now let me invert the question then. Was there a moment in those days where you went, “Oh my gosh, it is going to work.”

CAROLINE            Yeah, we had those two and of course, those cycles usually came and went with funding cycles that it was always a relief to feel like you actually weren’t going to be cash constrained and miss payroll. All those realities that we lived with for many, many years.

BEN                           Yeah.

CAROLINE            But I think even when on a daily basis we were like, “Oh, I’m not sure about this.” We just were kind of in denial about it or we ignored it and we just persevered.

BEN                           Did you compartmentalize it?

CAROLINE            A little bit. I mean, a lot of times when people are wanting to be entrepreneurs and they’ve got an idea and they’re kind of in those very, very early stages, one of the first things I say is find a co-founder because you are in for a bumpy ride and I know that’s difficult advice to give and as I said, Lauren and I really lucked into partnering together.

BEN                           But nobody has all good days, right?

CAROLINE            Right.

BEN                           So usually, having one co-founder or more, it means that when you’re down in the dumps, maybe they’re not.

CAROLINE            And that was another sort of complimentary aspect of our relationship. We were total seesaw like that all the time and if I hadn’t had that, there was no way that this company would have lasted for 10 years and she would say the same thing just because not only are you sharing the workload, but you’re sharing the emotional load of worrying about going out of business and being responsible for a team and your investors and the whole list.

BEN                           How did you process that emotionally? Were you two intentional about sharing between the two of you? How are you doing with this?

CAROLINE            Yeah. Our relationship really evolved into a sisterhood. I mean, I know so many founders’ stories can go one way or the other. Ours, I mean, of course sisters, meaning that we also bickered and we were also rolling our eyes at each other and all those petty things would also happen, but we are as close as sisters and share everything and there was not really a filter that either of us felt even though we on occasion feel the need to lift the other one up. There was never this we couldn’t be honest with one another about our concerns or our fears. So, I mean that was just naturally how this very acquaintance-like relationship evolved over time.

BEN                           Kind of pushed through friends to even another level beyond.

CAROLINE            Yeah. Yeah.

BEN                           So, if you had to map out the roughly 10 years that you were doing NurturMe, would you describe it as a pretty steady climb or was it a roller coaster? Where you’re like, “Okay, it’s working. Oh no, it’s definitely not working. Oh, it’s going to … We’re going to take over the universe …”

CAROLINE            “We’re going to do this.” Yeah.

BEN                           “Oh no, we’re toast.”

CAROLINE            “We’re done.”

BEN                           Or was it relatively stable?

CAROLINE            No, no, it was not relatively stable. Not at all. No. So our first year, we were high fives, we were getting money, we were getting on shelves. We were like, “This is too easy. Why is everyone thinking this is hard?” And then second year was when it was like, “Oh shit, all those accounts we got last year are telling us they don’t want us anymore.”

BEN                           That’s right, because you’re not performing the way they wanted you to.

CAROLINE            Yeah, so that was the first roller coaster dip and that’s when we kind of began assessing this pivot we need to do and luckily, a lot of our investors backed us during that which was a very dramatic change from what they had originally invested in. But they saw also the dynamics of the category that were shifting and a lot of things that we had to react to. So, that was sort of an upward climb and we kind of thought, “Okay, this quinoa thing has legs.” And then really the next peak that comes to mind which is a few years beyond that, that was sort of steady.

                                    That’s when we began kind of doubling top line sales year over year and kind of getting that from 500 to one million to go on from there and once you hit that two million mark as you know is sort of an unofficial line in the sand of, “Okay, you qualify for some venture funding versus angel funding.”

                                    And up until then, I’d always, 80% of my time, if not more was always spent on cobbling together 25K checks from angels to sustain what we were trying to do including this significant pivot. But once we moved into that two million dollar territory and could get some early stage money behind venture money behind us, that was kind of the first big peak where we were like, “All right, we have money to work with and we can actually have growth capital versus just cobbling, survival capital.”

BEN                           Survival capital, yeah.

CAROLINE            That’s exactly what I’d call it. And that was exciting and that was when everything started. The office was, there was a vibe and it was like a little beehive.

BEN                           You can hire people.

CAROLINE            We were hiring, there was products to ship, meetings to attend, everyone was busy, everyone was happy and things were kind of moving along and really that was sustained for many years and of course, there was always account losses and this particular line is not working and we’ve got to pivot this and that.

BEN                           Right.

CAROLINE            But then I’d kind of say we plateaued a bit and that was where kind of the story changed for us personally because then we’re kind of waiting into seven-ish, eight-ish years and at that point in the story is when really what happened actually, I started just feeling a little fatigued and I started seeing the tea leaves.

                                    “Okay, this is all great and buzzing along, but still we’re not profitable.” Which by the way is I think an unspoken truth of a lot of early stage brands. So, I saw the need that we’re going to continue to be reliant on investor capital fundraising once again. Everyone’s ownership is continuing to reduce including ours, our investors and I was just getting a little fatigued about the whole thing. I was trying to put in motion something for the company as well as for myself personally.

BEN                           Well, I was just going say that I think for a lot of people when they start off a company, they think, and I believe sort of the media probably feeds this a bit, but I think there’s this idea that I’ll do this for three to five years and then I’m going to sell it or do something, something great will happen.

CAROLINE            That’s what everyone thinks.

BEN                           And it is tremendously rare, particularly in food and beverage for the timeline to be that brief. Your timeline is actually pretty favorable. It’s averaged to like seven to 10 and again, there’s some survivorship bias in there a little bit too because a lot of things never make it that long, but it is more likely that you’re going to get to a point of acquisition in some scenario in the seven to 10 year mark which is a long time, especially if you’re a younger person too, right?

                                    And you’re like, “You’ve never been there. You didn’t go to college for seven to 10 years hopefully.” Or whatever the thing is, right? And so, it ends up being, “It’s a slog.” And so, you’re in the midst of that just like, “Here we go again.”

CAROLINE            Well, and a little bit of an aspect for us also was that this whole inspiration for this line was our babies and they’re now 10.

BEN                           That’s right.

CAROLINE            Personally, we’re out of the baby food category and we kept expanding our portfolios that we aged up. That was sort of by design and that was part of our business plan, but still, here we are in front of buyers talking about pureed baby food and going on almost a decade of that, ready for our own next phase of life.

                                    So meanwhile, I enlisted the help of a coach, executive coach is used very loosely. This was really more like a life coach kind of person and I went to this session in San Francisco that ended up being like a manifestation exercise and it was a day long, it was emotional.

BEN                           Was it one on one?

CAROLINE            No, it was a group therapy session actually, and I was really the only one there kind of for this particular career based thing. Everyone else was working through some personal stuff.

BEN                           Right.

CAROLINE            Of course, this was personal too, but …

BEN                           Sure.

CAROLINE            Meanwhile it was an experience.

BEN                           Did you know what you were walking into here?

CAROLINE            Not really, what I was told, it was an exercise that I knew I was going to be dealing with energy, energy fields and I was open to all of it and I just said to her, “I want to manifest what comes next for myself, but really for my company.” I came and think about what I’m doing next without this having a successful or a soft landing.

BEN                           Right.

CAROLINE            And so that was kind of the premise of this exercise and within three months of that, I’m at Expo West again, of course and I get introduction, sort six degrees of separation. I ended up getting connected to a woman who used to run Gerber back in a few years prior and I think, “Great.” And we start this relationship from long distance. And I think, “We’d love to get her on my board.” Maybe she’ll invest. At best, I want her to just have her be a personal mentor to me. We come to find out over several weeks and then months of this mentorship that she wanted to get operationally involved.

                                    And so the next thing I know within four months of that manifestation exercise, my board and I are extending an offer for her to replace me as CEO.

BEN                           Okay.

BEN                           Exciting and scary.

CAROLINE            It was more exciting than scary, honestly. I mean, of course, this was my baby, but I was very much ready. I’d seen this playbook before also where founders get companies to a certain level and of course, this isn’t always how it plays out, but I’d seen this a couple of times so that my ego wasn’t too tied up in this happening, I kind of thought, “Here’s the industry expert, she’s going to accelerate growth, ramp this to the next level and we’ll all be on our way and this is perfect.”

BEN                           Yeah.

CAROLINE            And of course, it played out a little differently than that.

BEN                           Right.

CAROLINE            But it ended up exactly as I said is essentially how it unfolded, a little more tumultuously, but yeah, so that was kind of the finale.

BEN                           So when you were no longer CEO, what did your role become?

CAROLINE            So for several months, me, Lauren and this woman whose name is Dianne, we’re a leadership trio where we were just all dividing and conquering the work to be done and she, one of the main things which I think is a huge lesson I learned that we alluded to a minute ago regarding fundraising was profitability. She was really brought in to help improve the financials.

                                    And really up until her she came onto the team, us and our board, we were always aligned around this growth strategy. That was the metric we were all focused on was top line growth and that’s what we believe was going to make us an attractive acquisition target, but that’s another thing that changed over the 10-ish years that we did this and we learned that too late to be honest, because by the time she came in, she did have a P&L that really needed cleaning up. And so that’s what really led to a lot of cost improvement initiatives around SKU rationalization, even account rationalization.

BEN                           That’s right. Yeah, the slotting fees are just tremendous.

CAROLINE            Just even the margin cut. I mean, the requirements for marketing plans. It was a growth strategy versus a profitability strategy, and I remember an early board meeting where we were faced with that question and we were trying to tell certain board members, “Now, this is how it works in CPG. You’re not CPG guys and trust us, this is how it works.”

                                    And they were saying, “Well, okay, but you at least want to start getting yourself on a path to profitability because even though if you focus on that now you, yes, you will achieve a lot slower growth and you won’t have an exit in three to five years, which of course if what we were aiming for back then.”

BEN                           Right.

CAROLINE            But anyway, that became a big lesson that we learned over the years.

BEN                           Well, because when you’re on the path to profitability or you achieve profitability, then that gives you options and options are really good.

CAROLINE            So ultimately, we didn’t own our own destiny, we were beholden to investors. We needed them to be at the table during those final transaction moments where we were asking them for additional money to help facilitate the transaction or bridge the transaction. And yes, we weren’t in a position then to say, “Here’s what we would like to happen.”

BEN                           That’s right and I think that’s interesting. It’s super common and I feel like it’s endemic to the process on some level where I feel like there’s kind of these dueling schools of thought, right?

CAROLINE            Mm-hmm (affirmative). Exactly.

BEN                           So one school of thought is, “Well, you should just grow in a very methodical, profitable way, only take on good accounts, et cetera. Make sure your margins are good.” The other school of thought is grow at any cost, raise money, maybe not at any cost, but grow quickly, right?

CAROLINE            Mm-hmm (affirmative).

BEN                           And the trade-off with that one, again, typically, when you to a big show or whatever the thing is, the brands that have the big splashy things are not the ones that have been profitable and methodical.

CAROLINE            That’s exactly right. Yeah.

BEN                           And so again, it’s pretty cool because those founders become a form of a rock star. I guess that’s neat and certainly probably is really great for their egos and all of those things, but a little bit dirty secret behind the scenes of that is that that person or those people are being diluted at every, almost every day, right?

                                    And so because in order to perpetuate that and propel the engine, you’ve got to keep raising and every time you’re raising, you own less and less and less and less and at some point, it creates a perverse incentive that you kind of don’t care in the same way anymore because you realize that there are like 40 other people who are going to benefit much more from this eventual acquisition than you will personally and you had all the blood, sweat and tears and the original idea and that sort of thing, right?

                                    So, it creates I think for a lot of founders, I think it’s important to and I try to encourage people to be thoughtful about it. I’m not necessarily saying that one is perfectly right in all cases or the other, but you should know that you’re making some decisions now at this early stage that are going to have ramifications down the road.

CAROLINE            Well, you are 100% right, and this is literally one of the main lessons that I walked away from this whole experience.

BEN                           Yeah, you made this decision early on and it’s fine because you had a business that you wanted to go after the growth and you’re going to sell it for hopefully lots of money in three to five years and in order to get there, you’ve got to hire all the people, you’ve got to grow all the things, right?

CAROLINE            Yeah, and the other interesting thing about making one choice versus the other is the one choice that’s so dependent on investors and getting that equity, the other interesting dynamic that shift over NurturMe’s lifetime was that the investors started being more interested in profitability.

                                    This particular path was also kind of pivoting over to the other school of thought and so that money was no longer available. I mean, aside from the fact that as you said early on, there were so many more market entrance to this whole CPG space, it just became that much more competitive because it was all the unicorns who were getting a lot of the investor dollars.

                                    If you didn’t have really great sales metrics and financial metrics, you fell into this middle tier of potential brands that would be interesting in the first place and then you started hearing from these investors that what they were really looking for was healthier financials that that did have a healthier bottom line than we were having to provide to people in our early days.

BEN                           Right. And that is driven by the strategics, right? Who ultimately, I mean, they don’t want to have bleeding. They don’t want to just pick up a new small division that’s just bleeding cash all the time. The reason they’re buying you is for the growth and ultimately, for the contribution margin. For the additional incremental profitability that they will be able to ring out of your business unit, right? And if you’re going in the opposite direction, then that’s not actually very helpful to them.

CAROLINE            Right.

BEN                           Right? Because they’ve got plenty of doors, they’ve got plenty of brand recognition, right? They’re trying to say, “Oh I can bring on this business and it’s going to contribute another several million dollars to the larger pie.”

CAROLINE            Well, of course, what we were thinking early on was, “Well, they’ve got all the infrastructure, that they can tighten up our bottom-line expenses through an acquisition and that’s why the top line piece is what’s of more importance.”

                                    But exactly as you said, I think that that has also shifted because potentially, maybe it is that they had a lot of unsuccessful acquisitions 10 years ago that they learned those lessons from and so now they’re looking that other metrics are now more important.

BEN                           So the way that I usually think about is, those big strategics are looking for brands and they’re looking for a brand that typically has an extensibility to it, right? Maybe it’s really strong in one category, but they can extend it out and go from baby to toddler to some other things like that.

                                    And they’re also looking at margin. They want to know that you have a good margin because they assume, like you said, that they can improve that margin, but they don’t want to take your negative margin and try to just barely through Herculean efforts get it positive. They want to take your already solid margin and make it astronomical and then they’re also looking at velocity, right?

CAROLINE            For sure.

BEN                           Is this a product that is moving that at the shelf? That is resonating with consumers and those tend to be the top three things that they’re really looking at and if you’re ignoring those as a startup, that’s probably to your detriment.

CAROLINE            100%. And speaking of extendibility, that was actually another tough lesson we learned as we waded into this specialty diet area that was trending.

BEN                           Tremendous growth. Yeah.

CAROLINE            There was a huge opportunity there and we were really differentiated in baby for focusing on it. And again, to this growth-based strategy, we got the advice and our board got aligned around this idea that, “Let’s go after other pockets. Where else in the grocery store are there gaps where we could bring a similarly ancient grain based or dairy free or gluten free, whatever it is, where are the real opportunities to fill in some of those gaps and just make our brand extend into additional categories?”

                                    Well, probably not surprising at all within the year of doing that and experimenting, we had spread ourselves way too thin. It was a totally different group of buyers that we were trying to sell these products into. So, there was no efficiency, from a customer acquisition standpoint, there was zero efficiency.

BEN                           Yeah, you could have the best relationship with the baby buyer and that’s not going to help you over here into whatever juice section.

CAROLINE            What does make sense and I don’t know how many categories is this applicable to, and maybe babies are unique in this way, but it did make sense for us to age up into the adjacent category of kids. Kid snacks which isn’t necessarily nearby.

                                    Parents do shop from baby and then they start migrating into that other aisle as their kids age up. So, there is some familiarity, some brand recognition that will carry over there, but there’s not brand recognition from baby into dairy.

BEN                           And you also have to be careful with kids because then you have the big kid phenomenon.

CAROLINE            Yes.

BEN                           They don’t want to be the kid at school packing a Gerber branded thing and, “Oh, you’re eating baby food or little baby puff snacks? No, no, no, no, no, you can’t do that.” So, there’s a limit to that.

CAROLINE            That’s totally true. The other interesting thing, there’s so many nuances to our category. In baby within that particular aisle itself, there’s this idea that parents are doing the shopping from zero to one or two and then around toddlerhood is when the kids start having an opinion about, “Oh, I’m going to grab for this packaging because there’s a kangaroo on it and that looks interesting to me and that looks fun and cool.”

BEN                           Right.

CAROLINE            And so the kids get a little bit more of a say and so of course, from a branding perspective and from a product extension, we were always having to keep in mind who that shopper was because within the category, it was two different sets of people.

BEN                           That’s right. It begins to be sort of a dual purchaser thing where someone is introducing it, you have like a gatekeeper and then the parent has veto power right over it.

CAROLINE            Right. Of course, all the packaging for the infant products is very health and nutrition based and then as you age up into kid, it’s much more playful and eye catching.

BEN                           And the premiums are at the lower shelves rather than eye level is different.

CAROLINE            Right. Exactly. Yes.

BEN                           Yeah, all of that stuff. That’s super interesting. So now one thing I wanted to ask you, you guys made a decision. It sounds like this had something to do with how you were raising money at the time, but you had moved outside of the Austin city limits, right? And that was because of a particular program that you were participating in. I just think that’s really interesting and a somewhat unusual story for somebody who’s starting a business inside a city.

CAROLINE            Yeah, well, once again, it was a requirement of our investors. I mean, so much of our story unfortunately is this lesson learned about having investors dictate a lot of decisions.

BEN                           For good and bad, yeah.

CAROLINE            For good and bad. Yeah, exactly. I mean, I can credit them with tummy friendliness, for example, but there were other things that popped up that we didn’t have an ultimate say and one of which was one of our biggest investors, that institutional fund that I mentioned who came in was a USDA-backed fund, so an agricultural USDA fund.

                                    And so one of their requirements of the companies within their portfolio is that they are rurally located. So here we were with a downtown office on South Lamar and so we decided to move 30 minutes away into Dripping Springs so that we qualify to accept their money.

BEN                           Right. Which has implications for hiring, and just kind of quality of life, like commuting type stuff and that sort of thing.

CAROLINE            Yeah, and with Austin being such a hub, the hiring in particular or retention really was an interesting thing that luckily, we didn’t struggle with too much and the team who migrated out there in Dripping is a lovely little town.

BEN                           Yeah, it’s very, very nice.

CAROLINE            And it’s a beautiful drive out there.

BEN                           But in general, that means that someone who lives in North Austin is probably not looking for a job in Dripping.

CAROLINE            And of course, we had team members all over the city who I’m saying, I’m talking about it as a 30-minute drive, but for many, it was 45 to an hour at different times of the day. And so yeah, that was definitely an aspect that we hadn’t anticipated when we said, “Yeah, we’d love this investor’s money.” And for this seemingly small commitment there were other implications we hadn’t thought about.

BEN                           And there are reasons for that. They weren’t just being arbitrary; they were kind of accepting this USDA backing that had all the: “we need to be promoting all the rural communities.”

CAROLINE            Well, in fact, I think part of the intention to exactly that point was hopefully you will hire from within that community and so, which I guess we actually did do to an extent. We always maintained a pretty tight team though. So, in the office, we were always less than a team of 10 and then we had some remote people. So, hiring was one area we were trying to be kind of lean about.

BEN                           No, absolutely, because you experience this when you’re having cash flow challenges and stuff like that, people expect to get paid, right?

CAROLINE            That’s correct. That was another thing we learned the hard way and we had a couple of near misses, a couple of opportunities where we had to say, “Payroll is going to be delayed or payroll is going to be less than it needs to be.”

BEN                           Which can spook people.

CAROLINE            Of course, and they were super painful, traumatic experiences for me and Lauren to have to do. And so yes, that was probably partly why over the years we just ended up trying to be as lean as we could be to prevent ourselves from facing that again.

BEN                           Right. So okay, so you brought in, again, to kind of get us back on the timeline, you bring in a seasoned professional person to kind of take over operations and your kind of operating as this triumvirate for a season. Tell us, what’s the trajectory that gets you from that moment through really 2019 and how you ended up getting acquired and all of that kind of stuff?

CAROLINE            So the high-level version of this story is so when the new CEO came in there. And this maybe is a helpful lesson for your listeners is I think a seasoned executive like that who comes in does have an expectation of having some budget to work with.

BEN                           And usually people to help.

CAROLINE            Right. Even if they’re being charged with optimizing cost structures.

BEN                           That’s right.

CAROLINE            And so ultimately, as we’ve talked throughout this entire conversation about the difficulty of raising money and getting, capital that’s very competitive, especially for a brand that’s eight years old in a very dynamic category, I think she expected to have more money to work with even to implement her turnaround plan as they started calling it.

BEN                           Right.

CAROLINE            Unfortunately Lauren and I started getting branded as the founders who made all kinds of mistakes.

BEN                           Who needed things to be turned around.

CAROLINE            Needed things to be turned around.

BEN                           That’s right. Yeah. Uh-huh (affirmative).

CAROLINE            But anyway, she ultimately had less money to work with than she wanted and so we ended up deciding as a board we were going to go to market sooner rather than later. So instead of having this period of essentially 18, 24 months of accelerated growth, then pursuing an exit, we decided to bring in an investment banking team.

BEN                           So talk a little bit about what does that mean? So, like you used a couple of terms there that again, I think some listeners might not be familiar with go to market and investment bankers, right? So, investment bankers for those of you who don’t live in the financial world or mergers and acquisitions, that sort of thing, these are not regular bankers who are working at your local Wells Fargo or Chase or whatever. They are deal makers, right? So, talk about how do you make that decision? How does that work?

CAROLINE            So again, this was agreed upon by our board, but to an extent dictated by some of our big investors who felt we’re facing the difficulty of raising enough money now so we should pursue an exit. Essentially put the brand and the company up for sale by soliciting the engagement of an investment banker, kind of a broker.

BEN                           Because otherwise, they would be diluted even further by whoever the new investor is.

CAROLINE            And of course, you’re also taking all kinds of things into account, not only the fundraising market, but there was a big concern about a second recession.

BEN                           Right. Right.

CAROLINE            All kinds of factors that you also have to take into account, what’s happening in the category and what’s happening in food in general. So those things considered, but primarily this cash constrain aspect of it was what drove us to decide we’re going to do this engagement. But it can also, of course, I think what probably a lot of new inexperienced entrepreneurs assume is that that process happens organically without you having to solicit it.

BEN                           Oh, okay.

CAROLINE            And that also happened along the way too, in places like Expo West for example. There were always the people kind of sniffing around saying, “We’re interested in talking about acquisition.” And we had one really exciting moment where a big executive team from a big conglomerate came down to our little South Lamar office and we did a whole presentation. So, we had those moments too and that is of course one way that an exit can transpire.

BEN                           Right.

CAROLINE            But in our case, we ended up having to say we’re going to pursue this and not wait for it to happen organically. And so, we enlisted the banker and what they’re hired to do is the due diligence on the market for who’s looking for these types of brands, who plays in this space and then you put together a prospectus.

BEN                           And they reach out to those, the key people in those places and kind of gauge the interest that they might have.

CAROLINE            Yeah, so the exit that ultimately came about for NurturMe was a private equity company that bought the brand. Their vision is to acquire a few other brands potentially in the baby food category or possibly the baby products category. They already had a maternal health product or brand in the portfolio so that they’ve got a vision for sort of building out like brands and then I think rolling them up for an eventual sale.

BEN                           Right. Which is again, a pretty standard private equity playbook, right? This is a firm that has raised money from institutions, universities, endowments, pension funds, et cetera. Maybe some really high net worth individuals and they’re investing that money on those people’s behalf and a standard private equity playbook is to take disparate, smaller to medium sized players in a market.

                                    A roll up is where you start to bring all those under one corporate umbrella and kind of capture the synergies between those businesses, right?

CAROLINE            Yes.

BEN                           Because every one of those maybe has their own accounting function and they don’t need their own accounting function, whatever and so then at that point, the economics of that combined entity look better and then that actually in its larger captures the attention of someone else who as a strategic acquirer who then would pay an even further premium on that, right?

CAROLINE            It’s a combined enterprise value.

BEN                           That’s right. It’s greater than the individual enterprise value. Okay. So, you go through that process, again, you come through it. I think that’s a foreign world. It can be stressful. It can be exciting in some ways, it’s kind of like a kid graduating from college or going off and starting their life and you’re not involved anymore. So, they’re probably just a big swirling ball of different emotions, some good and bad, right?

CAROLINE            Yeah.

BEN                           And then when you come out on the end of that, the backside of that transaction and the dust settles and all of that stuff, where was your head at and then how long did it take you to sort of like get your bearings again?

CAROLINE            Yeah, a while. So, I didn’t finish answering your question from a while ago talking about sort of when Diane was brought on and kind of how that played out. So, for about a quarter, the three of us retooled the strategic plan, broadened the banker. And by then, unfortunately we did not only shed accounts and SKUs, but even team members, we were really just getting it down to the bare bones as lean as we could be, again, to optimize the P&L.

BEN                           Right.

CAROLINE            We didn’t shift dramatically from growth to profitability, that was kind of a new strategy and that actually became a selling point for the acquisition. Dianne is now in place and here’s the new directions we’re heading.

BEN                           Right.

CAROLINE            Doubling down on the top performers, et cetera. So after the dust had settled and we sort of began to execute what the operating plan that she kind of mapped out, I then was really sort of in a figurehead role, primarily owning sales as the face of the brand and being out front for marketing and PR kind of opportunities.

                                    While Lauren continued her operational role, which was very distinct from mine and Dianne really had taken over all of the other things that I had been responsible for including board management, investor management, team management, sort of all the other pieces that she had assumed.

                                    And so, we decided that it was appropriate for me then to work on a part-time basis. So really for eight months during this transaction process, of course, that’s another thing that we thought, “This will be a two to three months.” And then it extends and extends and extends.

BEN                           Sort of colonoscopy at the same time.

CAROLINE            Yes. So, all of these timelines you need. It takes longer and requires more money than you ever think at the outset. But it really afforded me some time, like after I sort of stepped back and of course, I wasn’t entirely graceful about the role that I had. My new role that I had assumed and sort of having less, being less than a decision-making capacity or leadership capacity.

                                    But to an extent, there was also a little bit of a burden being lifted off my shoulder and Dianne was gracious enough to say that at one point she was like, “I want to take some of this off your shoulders because I know that you’ve been working so hard at this for so long now.”

                                    But that’s when I sort of began to step away, but I wanted to see the transaction through and really Lauren and I just became emotional support for one another. There’s a lot that happens during a transaction that you question, and it makes you worried, “Can you trust these people? Are we going to get screwed in some way?” All those types of things.

BEN                           Lots of legal documents.

CAROLINE            Lots of legalities, lots of conflicting priorities and outcomes for different people and so that was the sort of thing that Lauren and I were really kind of keeping one another, trying to just watch each other’s back through.

BEN                           Especially when you have a lot of investors because all of them have different rights privileges, there’s a different cast, waterfall, cascade and somebody gets this and it’s not just you own X percent, so you get X percent of the transaction. No, no, no. It’s much more complex than that.

CAROLINE            It’s much more complicated especially after eight years of repeated fundraising.

BEN                           That’s right.

CAROLINE            And so, but then ultimately when the transaction happened, I took the balance of the year, so we sold the brand in August. I took the remainder of the year. So until very recently, I really was just sort of decompressing from the whole almost decade long experience and really feel that I can now kind of look back on it and appreciate in particular that we created something out of nothing and there was that and, but especially Lauren and my relationship.

                                    Here, we were like two virtual strangers who over 10 years, we both built families. We both became as close as sisters. I’m her daughter’s godmother. I mean, there’s a lot about that story alongside, the company’s story.

BEN                           You went on a really intense journey together.

CAROLINE            Totally.

BEN                           Yeah. So then, and you had alluded to this early in our conversation that you had always thought of yourself as wanting to be a writer, right?

CAROLINE            Yes.

BEN                           And so this has now kind of opened up a little bit of space for you to reflect and to actually put pen to paper as they were.

CAROLINE            Yes. So that was actually an exercise that I did while I was processing this 10-year experience and I just started writing about it and it became something that took about six or seven months to get down on paper and out of my system. And it was a fun, cathartic exercise and it really did help me also kind of connect the dots of how everything transpired and then really kind of make sense of it and appreciate it and also get the closure where I now feel ready for what comes next.

BEN                           That’s right. Yeah, because you experience life as a series of discrete moments and they don’t necessarily have a narrative structure to them, right? And so, it’s only in thinking back across that and connecting those dots that you begin to go, “Oh yeah, this happened which led to the next thing which we …”

                                    When you read a book or you watch a movie, you see that and we just think that that’s how that goes, but then if you think about your own life and your own experience, the flow isn’t always present.

CAROLINE            And especially the success and an exit was never guaranteed. So, the entire time we’re wondering, “What’s the outcome here?”

BEN                           That’s right. Yeah.

CAROLINE            And of course, the outcome was not what we had envisioned or not the pie in the sky exit that we were initially aiming for, but I think also our definition of success and the way we view the whole experience, that also got sort of re-imagined along the way.

BEN                           How did it change for you?

CAROLINE            Well, we were always following  “The standard playbook” of you launch a company, you grow it for three to five years, you focus on growth, sell it to a strategic.”

BEN                           You make many millions of dollars.

CAROLINE            And there may have been a few examples that I really can cite that that happened to where of course, the large majority, it plays out in a very different way, but I think that that was sort of the game plan at the outset and I had no idea sort of what we were in for and the fact that having … I think that basically what I’ve come to appreciate was the journey. How much we learned. We got a crash course in fundraising and private equity and product development, and just the whole CPG industry.

BEN                           It’s the best MBA you could ever ask for.

CAROLINE            Yeah, completely. So yeah, I’ve just come to appreciate not only that but I think at first, we sort of had this very simplistic, “Yeah, let’s grow a brand. Let’s build something, let’s create something.” And that’s eventually exited, hopefully to now saying that having built something, not only a brand and a company and food products, but a team and a relationship with my co-founder and a family alongside all of this.

BEN                           Absolutely.

CAROLINE            All of that just becomes much more valuable.

BEN                           Yeah, no, that makes all the sense in the world. So as you’ve reflected on your own journey, what are there some lessons learned that have really crystallized for you that if you’re sitting down having coffee with a newly minted founder or something like that, that you say, “Oh, I really need to share this with you because I learned this and if I could go back and tell my younger self, these are the key things that I would definitely stress.”

CAROLINE            It’s two things which we’ve touched on during this conversation, but just to kind of recap.

BEN                           Yeah.

CAROLINE            Number one is I do think co-founders are needed. I mean, even if it’s not a 50/50 split, but just to have someone who’s in the trenches with you, to be alone, person in charge of what could become a very big team and a very big, cap table of investors. Just tons of responsibility and tons of pressure. I would say that that was something that that was required for our brand.

BEN                           So you had one co-founder. Do you see in your experience, is that the right number? Should there be like ideally, should you have two or three?

CAROLINE            Well, in my experience, by the time we were a threesome, Lauren and I had so much history and just the dynamic of Dianne being asked to kind of fix things, I didn’t necessarily feel like that was a very healthy, productive structure. So I’d say, no different, but I would say kind of a duo and especially if, because again, as we’ve said, it’s kind of hard to say, “I want to find my co-founder who’s going to be a perfect fit.” But seek out someone whose skillset compliments yours. Maybe even whose demeanor is opposite your own. Just find someone who just can kind of round out your gaps.

BEN                           Right. In the tech world, this probably more codified and well known that that most often you’ll have a business co-founder and a technical co-founder, which you two were on some level, not that it’s not exclusive, right? But you can think of in this case for a food company, technical doesn’t necessarily mean you’re coding or you’re a software engineer, it means that you’re focused on making the food, right?

CAROLINE            Product development.

BEN                           Yeah, product development, supply chain, things like that and then somebody else who is focused more on if it’s raising investment, understanding the business and administrative sides of it and then also typically the sales, sometimes marketing or maybe that’s another person, something along those lines.

CAROLINE            Exactly. Yeah, yeah.

BEN                           I feel like you guys actually had that kind of dynamic.

CAROLINE            We definitely did and it was partly because of our backgrounds coming into this where she had been a culinary arts teacher and I had spent 10 years in corporate America, but there was also just a lot about our interests that again, we didn’t necessarily discuss at the outset, but we just naturally gravitated towards two different sets of work and so we got it all done because we were managing the workload in that way and kind of balancing it I guess.

                                    So that’s lesson one and then the second which I don’t necessarily think we resolve, but it’s just the acknowledgement of the two strategies and the two different tracks to take and pursue in building your business. Are you going to take the profitability track or are you going to take the growth track?

                                    Because I don’t necessarily think there’s a middle ground unless you shift from one to the other. Maybe we could just pursue growth at the outset just to get some traction and in order to bring in money or in order to get into doors, you kind of pursue that and you invest in that, but then pivot towards profitability. I mean, maybe that’s the way to make it work, but I think you just need to acknowledge that there’s a choice there.

BEN                           Right. Well, and I think that there, and you alluded to this also which is you can’t just decide yourself. If you go down the growth path and you have all these investors and you sold them on a growth story and you say, “Yeah, yeah, yeah, yeah, I changed my mind. We’re not interested in growing anymore. We’re only interested in maximizing our profitability.” They may or may not be cool with that, right?

CAROLINE            Great point. So that would be a reason to get alignment around that like, “We’re going to take your money now and we’d get that what you’re attracted to is the fact that we’ve got this proof of concept, but we do intend to optimize our financials and have a more conservative spending.” Whatever it is, the alignment at the outset versus having that dictated to you after the fact, just out of necessity.

BEN                           That’s right. Yeah. Absolutely. What about the discipline of writing as an entrepreneur? Right? So, I know it’s hard and you didn’t necessarily, you weren’t writing the whole time, but are there moments where you feel like, “Hey, you recommend this to two founders.” Or maybe it’s just people in general to help them process what they’ve gone through?

CAROLINE            Yeah. I don’t know that it would work for everyone.

BEN                           And maybe not to be even be published, right? Sometimes it’s like just the exercise of doing it.

CAROLINE            That’s exactly right. I mean, honestly, this book might not see the light of day, but just getting it out of my system was so enjoyable and I mean, one thing, just spending my time in a different part of my brain I think on a different activity and kind of learning something new.

                                    I was really craving that after eight-ish years and it’s kind of when I started doing this of really staying in one space and talking about a product family and kind of repeating myself to buyers or investors or whoever it was. It really was kind of just enjoyable to learn something new to do. There’s some similarity for me anyway, that it was sort of a creative exercise and there’s obviously a lot of creativity that I think comes along with entrepreneurialism.

BEN                           You are literally creating something that didn’t exist.

CAROLINE            Creating something, yeah. So, I enjoyed it for that reason. Then I also think any entrepreneur can relate to this. I was used to firing on all cylinders for a long time and having my time very managed and having to figure out just how to be productive, especially as a parent while running the business and I just found that when my schedule decreased that I personally needed to keep up some momentum and keep my, my brain working and writing kind of helped fill the time and gave me some structure to my day where I could kind of plot out what my goals were and when I wanted to get certain things completed or and so those were two main reasons why it was just a really fun, natural thing to do.

BEN                           No, that’s great. Are there particular lessons that you learned that you find valuable to share with either women or more specifically moms who are starting a company? Like how you achieve? There’s a lot of cultural pressures, there’s a lot of expectations that are put squarely on your shoulders. In particular as a mom, your family obligations and that sort of thing and you’ve got to travel, and you’ve got to do all these kinds of things. Did you ever find a groove that you feel like worked really well for you and your family?

CAROLINE            I did, yeah. I mean, it helped that I was in the baby category, because when I had my baby, when we were starting things out, she would come with me to Central Market and we would hand out samples together and she’d be the cute kid who was on the box and so that was a little unique. But even so, I think if I were in the smoothie aisle with my kid, that would be something that customers would respond to.

BEN                           Right. But there is a point where they get a little bit older and you can’t put them in the Baby Bjorn thing anymore. Yeah.

CAROLINE            True. True. But I guess maybe the interesting thing that I’d say in response to that is just how different Lauren and I each reacted to being working moms and co-founders and running this business is one thing that I, in hindsight kind of realized that I did

                                    I think in my mind, having balance meant matching the weight of work with sort of an equally robust sand pile on the life side of the scales. So, it really was important to me to kind of prioritize my social life and turn off work as much as I could on the weekends. Not spend every night with my computer on my lap in bed. So it kind of had some boundaries and again, I just, not only was I putting some boundaries around work to the extent that I could because of course it bleeds into every area of your life and it’s something you do on weekends, but that was my response was balance to me means filling this out with a really close community that I invest my time in as much as I can outside of work, including family of course.

                                    And Lauren kind of did the opposite. What worked for her, was kind of putting blinders on and really staying focused and kind of pulling in, I think otherwise she would have felt like she was spreading herself too thin. She had two young girls a little later in our process actually, but by the time that happened for her, I think she just really wanted to focus in on her immediate family while focusing on work. So, I guess what I mean to say is for everyone –

BEN                           It’s going to be different.

CAROLINE            Of course, it’s going to be different, but I will say that having started a business as a pregnant person and then going on to have three kids during the course of the journey was doable and it wasn’t any Herculean effort. I’m not unique in any way. It was doable partly because Lauren and I did have the luxury of kind of establishing the ground rules for the way that we ran the company and then we modeled that for our employees. But yeah, it can be done so don’t let that deter you if you’re a pregnant person listening.

BEN                           That’s good. That’s really good. How do your girls process the business or the company now? In retrospect.

CAROLINE            I don’t know, I mean, I think they don’t know any different.

BEN                           That’s just what you’ve always done.

CAROLINE            Just what I’ve always done, and we’ll be in the store and we’ll check in on the aisle and check out the products and for a while. Audrey actually was on our packaging, so that was kind of fun I think for her as a younger kid.

BEN                           That’s right.

CAROLINE            No, I mean I think that they’ve been proud of it, I guess. But again, I don’t know anything different.

BEN                           That’s right. It’s just the air they breathe, the water they swim in.

CAROLINE            Yeah.

BEN                           So now in this next chapter for you, you’re actually still maintaining your relationships in the consumer-packaged goods world, but you’re about to kind of go into the tech space a little bit. Tell us a little bit about what you’re doing next.

CAROLINE            Yes. So, the way that I think about this next move. I’m about to join the leadership team of a tech startup, but the focus of the product is to bridge the women’s leadership gap and so I kind of found, I think at the end of my experience with NurturMe just, I think I’ve spoken so much about being female co-founders and the value and how significant that was for me.

So that’s sort of something that resonated as opportunities were popping up over the last year. This particular company, which is called Ceresa, they have a mentorship program that that pairs more seasoned female executives with women earlier on in their careers to help them develop tools and advise them on ways to progress into the upper ranks of companies.

BEN                           And to even see that as a possibility, right?

CAROLINE            Yeah. Yeah.

BEN                           To imagine themselves in those roles which is a very powerful tool.

CAROLINE            So, I’m super excited about it and I do especially love that it is a startup. I think that that’s kind of the space that I’ve found is my sweet spot. I love the IKEA tables and the Taco Tuesdays and I’m just kind of ready to get back into all of that, but really, also feel very kind of aligned with this company’s mission, but as you said, absolutely want to maintain ties to the CPG community which is thriving here in Austin and very much a network of people that I want to remain tied into.

BEN                           Absolutely. Well, I think it’s really cool that along with your co-founder Lauren, you walked down this path and experienced the highs and the lows of it and now, you’re in a position where you’re going back into a startup, but it’s a startup that’s a really tailored around really speaking into the lives of other young women who are maybe in an analogous position to where you were 10 years ago.

CAROLINE            Yeah, totally.

BEN                           And that’s a really cool kind of circular giving back opportunity as well.

CAROLINE            Thank you. Yes. I hadn’t seen it like that, but you’re exactly right.

BEN                           Yeah, that’s really fun. Well, I just want to thank you again for sharing your story. It’s powerful to hear from my perspective. I know that for our listeners. It’s a unique story, I think it almost has a false kind of simplicity to it when you go, “Okay, see? We started the company and then we sold the company and we tied a ribbon on it.” And the truth is always, it’s messy and there’s moments of existential crisis where you don’t know why did I ever do this and all of that, but you made it, you made it through all of that and now you’re sharing with other early stage professional women and soon to be executives, what you’ve learned along the way.

                                    I think that’s really amazing. Along the way, you built a really remarkable company that will continue to serve babies and families, hopefully for decades to come and you built a family in addition to all of this. You’re to be commended on all of those fronts.

CAROLINE            Thank you. Thank you so much.

BEN                           Thank you again for joining us and again, thank you for listening. If you get a lot out of these conversations, I’d like to encourage you to please share them with your friends and to please subscribe.

Also, please leave a review and a rating just so that more people can discover this. Our mission here is to equip emerging consumer brands and what we think at Barcode is that the more of this in depth kind of behind the scenes information that you can get as you’re building your business, the more it’s going to give you a series of unfair advantages as you continue to grow and take the next step. So, thanks again for listening.

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