Food Industry Leadership and Trends Panel

For the sake of time, and so that we're able to ask our panelists as many questions as possible, I will briefly introduce them all. Our first panelist, Ron Shaik, is the founder and former CEO of Panera Bread and All Bomb Palm, and is credited with defining the $100 billion plus fast casual segment. Today, he's the chairman and lead investor in Kava, Tate, Life Alive, and Level 99, and the author of Know What Matters. Ron makes his investments through Act III Holdings, a billion dollar plus evergreen investment vehicle. Seth Goldman is the co-founder and CEO of Eat the Change. that we've seen last Just Dice Tea, which you can try right outside of this auditorium. Thank you, Seth. In addition, Seth is the co-founder of Plant Burger, a plant-based quick-serve restaurant, Honest Tea, and the chairman of Beyond Meat. Peter McGinnis is the CEO of Impossible Foods and was previously president and chief operating officer at Chobani, where he helped build the business into an iconic brand in his nine years at Chobani. He also served as chief marketing and brand officer and chief commercial officer. And we have Solomon Choi. is the founder and former CEO of 16 Handles, New York City's first self-serve frozen yogurt shop, which he grew the company to over 40 locations internationally. He also co-founded Greeno Products and today through Jabba Brands, consults foreign investment early stage and emerging companies in food service, CPG and restaurant technology. Thank you all for being here today. I'd love to start by asking you all to briefly introduce yourselves and tell us about your Perfect. Can you hear me? Yeah, I'd probably describe myself as an overnight success in 45 years. So I started out with a single cookie store in Boston, Massachusetts, coming out of business school in 1980. I ended up, that company became Au Bon Pain, Republic, that then became Panera Bread. And it was sold for seven and a half billion dollars in 2017. Along the way we transformed the company four different times, which is really the interesting part. And having finished that I decided to put my money where my mouth is and help others do it. And that led to positions, majority positions in Tate, Life Alive, something called Level 99. And then we ultimately got very involved with Kava, the chairman there, and we helped them determine how to essentially build a dominant brand in a category. And I guess I'd end by saying that what we do today is bet on categories. Discover today what's going to matter tomorrow. What are the categories that are going to matter? And make sure that we're positioned in those categories with the brand that will end up being the dominant. Yeah, tough act to follow. I'm actually trying to be like Ron. That's my mission. Just live a few more years. But my journey is I moved to New York City in 2008, walking right into the subprime mortgage crisis and the Great Depression, as we know it, or the Great Recession, I should say. And bootstrapped 16 handles. So I took a $600,000 investment from family, opened in Manhattan's East Village. And with my experience in having opened up restaurants and franchise development for other brands. I decided I wanted to, you know, part of that course of building a brand and was able to successfully do so. Grew the location to over 40 locations. We had international locations at one point. So certainly got to enjoy that entrepreneurial journey over 14 and a half years. Exited the company in August of 2022. Got bought out by my largest franchisee and a YouTuber, Danny Duncan. I was not looking to sell at the time, but it was an offer I could not walk away from. It was millions, not billions like Ron. So again, I'm trying to work my way up there. But similarly, along the way, and as of six years ago, I started advising and angel investing into startup companies in the CPG space, restaurants, as well as restaurant technology. I was really able to use restaurant technology to be able to outmaneuver a lot of my competition in terms of being able to get early adopting users in markets like New York City to essentially hold on to the highest average unit volumes in the category of frozen yogurt. 10 out of the 10 years that I franchised. So very proud of that record. And yeah, and so here I'm now and, you know, hopefully we'll be able to connect with some of you here. Thank you. It's great to be here. I'm based up in Bethesda, just up the street, but have been based in this area since 1995. I was initially came out of business school and went into the investment business. And then sort of after a presentation, one day I went for a run and I was thirsty and I went to a... beverage cooler and I said there's nothing here to drink and so I launched Honesty because I was thirsty. I raised about five hundred thousand dollars from Friends and family and started brewing tea in my home, managed to get an appointment with Whole Foods where I had an empty Snapple bottle with a label pasted on it and five thermoses of tea that I presented to the buyer and managed to, you know, the buyer said we'll take 15,000 bottles, which for me was terrifying because I've never made it anywhere but my kitchen, and managed to sell it into the local Whole Foods stores here and then continue just to grow the brand through sampling. And by about 2007, we'd become the best-selling tea in the natural foods channel. And in 2008, we got reached out to by Coca-Cola, who invested and then bought the business in 2011. And I continued to stay involved with Honest Tea through 2019. But then in 2013, I got involved with a startup called Beyond Meat out in California that was seeking to really replicate the taste of meat using only plants, which... really resonated with me and my family. We were all vegetarian and very frustrated with the choices. So I got involved as a board member and then executive chair of Beyond Meat and helped grow and scale the business. And I'm still chair of the board there today. And so, you know, all the different things I've worked in, I really regard as mission driven businesses where we're trying to change the environmental impact of food, trying to change the health impact of food, and also thinking about the footprint. the labor involved. So everything we do it on is tea. Now with Just Ice Tea or Justice Tea, it's fair trade certified. And we've got some really exciting partnerships we're working on with tea growers around the world. Yeah, Peter McGinnis spent about 20 years in advertising, interestingly. Ran agencies in Asia, Europe, Chicago, New York, built brands, built awareness, made companies more accessible to people, grew affinity. differentiated brands and then I was kind of just fed up with doing that and the industry had changed so much it was consolidating and it was you know big holding companies bought these really creative boutique shops and they were publicly traded kind of gutted the companies and restructured the companies and it just wasn't the same anymore so I went over to Chobani as chief marketing and brand officer and helped make that a lifestyle everyday brand I ended up running sales in addition to that, ended up becoming president, and then running the company, and loved it. And it was about, you know, Greek yogurt was 0.5% household penetration when I started. It was 55 something when I left. No one wanted to eat Greek yogurt. And there's a lot of similarities to plant-based because it's small, right? So how do you make it accessible? How do you make people aware of it? How do you inspire people in new and different ways to consume it? And that was a journey. That was a nine-year journey. And it was great. And a lot of it was brand building. A lot of it was just distribution. A lot of it was innovation. Things like Flip, which put nuts and seeds and dark chocolate in it. And it was like kind of a gateway drug and, you know, Greek yogurt on training wheels, I used to call it. And it drove people into the category. And then I went over to Impossible again. Great brand, great product, you know, we're with Beyond, we don't compete with Beyond, you know, we're in the plant-based sector together and our role is to grow it together, but under-penetrated, right? 5-6% household penetration, 15% awareness, right? 94% of the country's never had an impossible burger, right? So that's what keeps me up at night, it's not the cynics, it's the opportunity. 85% of the country's never even heard of Impossible. You know, 900 total distribution points out of 9,000. So I think it's just getting started. So there's a lot of cynicism around this plant-based category, but it's in first gear. You know, it's young and it's forming and it has so much opportunity ahead of itself and already people are giving up on it and being cynical, which is just ridiculous. But I got to get off my little soapbox and we'll talk about that later. Well, to start, we're seeing a rise in influencer-led brands like Emma Chamberlain's Chamberlain Coffee, Mr. B's Feastables, and Prime by Logan Paul and KSI. In an industry as competitive and saturated as food and beverage, are you favoring partnerships with public figures or are you favoring other strategies to help compete? Can you provide an example of successful partnership, collaboration, or acquisition your company has been a part of? Let's start with Solomon, as I know you're an investor in Chamberlain Coffee. Yeah, so I am an investor. Love what Emma's doing. Wish I was in miss Feastables as well. But I do believe that in terms of connecting with today's customer and really the next-gen consumer, that's really what they're looking for. And I think social media and technology has really kind of blurred the lines and given direct access. I mean, when I think of direct-to-consumer... I think, you know, brands and offsets of people, people are brands. I'm friends with Josh Halperin, who's representing Shaquille O'Neal, kind of arguably one of the most recognizable faces on the planet, and he has his own burger chain now. Sorry, chicken chain in Big Chicken. Kevin Hart, who we all know, doing Hart House. So I do think that the extension of one's brand, if it's truly authentic to who they are, their followers and the next gen will see, will want to support that and be a part of that journey. Conversely, I think that kind of influencer marketing, as I've seen over the last decade, has really evolved a lot. And I think that tactic in and of itself, when it doesn't resonate with the core values of the individual, especially the younger generation, they can sniff right through it. Right? That's a paid ad. That's not real. They don't even do that. They don't even like that. And so I think brands need to be careful about doing it. But when it works, it works really well. It is like a 10x force multiplier. We did some at 16 Handles. I won't say anything that really moved the needle for us more so than with who we partnered with during the pandemic in launching Oatly. So we helped launch Oatly's soft serve product in 2021. And that was an opportunity for us to, again, align with a brand that we felt was kind of a challenger brand in a new category. Actually, coming from your record, we worked with Mike Messersmith, who Previously was the VP of Marketing at Chobani and then was the President of US at Oatly. And his family happened to live in the Upper West Side of Manhattan and were fans of 16 Handles, so that certainly helped. But for us, it was really aligning our expansion from going from just Froyo to now wanting to own a broader category of soft serve. How do we do that in an organic and meaningful way? Well, why don't we line up with a brand that our customer base is really focusing on and wants? It helped at the time also there was a national shortage because of... their partnership with Starbucks. You couldn't even get into Starbucks. And so I think that was a great moment for us to be able to use that opportunity to help launch Oatly in a meaningful way that also kind of rose our brand in terms of top of mind at a time when our store is being self-serve. I mean, in 2020 and 2021, that's probably the last thing that you're looking into is anything self-serve. And so with our kind of omni-channel, you know, sales channels with delivery, we've been on all the delivery platforms since 2010. So I think, again, being an early adopter, being able to get closer to the customer really allowed us to, I remember positioning this way. I mean, he laughed, but he understood. I said, hey, Mike, we're a SaaS product. He's like, you're a Froyo shop. I was like, no, but we're soft serve as a service and we can do this for you. And so I remember like that led to us being able to pitch him. And quite honestly, I owe them a lot because they saved us during the pandemic. I mean, we were able to secure half a million dollars from, you know, from that company with only 30 locations in the Northeast because we were able to show that we're able to reach that same demographic of consumer in a meaningful way and do it in a non-threatening way. And so that was kind of our experience in terms of working with brand. Ron? Yeah, I mean, I'm more negative and I'll explain to you why. I think when you talk about a brand, it's got to have integrity. It's got to stand for something. It's got to stand for why its product deserves and belongs in the world, why it's a better alternative. And when you're using somebody else. as the means to communicate that. You run the risk of both losing your own identity and you run the risk of ultimately succeeding in the short term for the wrong reasons. So I'm, and I know you expressed some cynicism, I'm ultimately very cynical. I can tell you this industry, my industry, food, is littered with folks that had names. but didn't have the ability to deliver something behind it. Yeah, and I'll just chime in. I agree. Because ultimately, you're selling food. So what a person says is, you know, as you said, people can be paid to say whatever. So ultimately, it's got to taste delicious. It's got to nurture somebody and provide the nutritional benefit or health benefit they're looking for. Of course, there's very little downside to someone saying something positive. But to me, you know, when it's authentic, that's great. And, you know, when someone puts out a… shares a tweet and it's very funny we had president obama is it was and it is a big honesty and now just iced tea drinker and it's great because he talks about it on his own we obviously don't pay him anything to say that um so we love it when he does but he's not a paid spokesman for us yeah i think um i think brands have to stand on their own two feet first right and you need to build your brand based on the service you provide the products you make your value system your belief system If you want to amplify that from time to time with some influencers, that's okay, as long as you pick the right one. We didn't need to go down the Bud Light angle, and we certainly don't. I mean, there's a lot of professional athletes, you know, in the food space and in a lot of different spaces, and, you know, one... you know has a drug charge one pulls out a gun in a strip joint you know it just goes on and on and on and you're very vulnerable to it um and you know the reality we talk about jared the reality is when you when you when you pick an influencer or a spot or you're sponsoring somebody you don't really know that person and you're not in control so you've just relinquished control of your brand now it's risky so you There's two sides to that coin. It's a total double-edged sword. So sometimes it works, and sometimes it's a really, really bad thing. So I'll just say I'm cautious, not cynical. Well, thank you. To switch more to a leadership perspective, at Amazon, Jeff Bezos is known to start meetings with a six-page narrative memo followed by 30 minutes of study hall. He also believes that the most senior person in a meeting should speak last. At Slack, the motto, work hard and go home, is painted all over the walls. With this in mind, all of you have assumed leadership positions in quite sizable companies. What is the single most crucial thing you have learned about leadership and are there specific and unique ways you implement this? Peter, let's start with you. Yeah, I can't do six-page memos. I have ADD. But, no, I think you just have to be present, you know. That's a literal and a figurative term. I think you need to be present, you know. text, on email, in the office. Be it showing up is probably one of the most important things you can do. And you have to lead by example. So of course you have to work hard. Of course you have to collaborate. I also think you don't need to be the smartest person in the room. Have a little bit of security and have a little bit of confidence so that you can let other people speak. I don't think you have to. make it like a rule that the most senior person speaks last, you should just behave in a meeting and not try to get the last word in and not try to be the smartest person in the room. I also think leaders are just, the more humanity you have, the better. So just be generous. Be generous with your time. Be generous with your lessons. Be generous with trying to teach people that work for you. So generosity, I think, is super important. And then I think our role as leaders is we're evaluated on how well the people report to us do, not how well we do. You already have the top jobs. You have nothing to prove. So you should be evaluated based on how well the people below you do as a leader. And that should be 100% your evaluation. So therefore, you have to be there for them. You have to be present. You have to be generous. And you definitely have to be more of a servant leader. And I think that's it's an overused term, but I think it's incredibly important. And that's my kind of perspective on it. I don't have hard, fast rules. It's just be human and don't be a jerk. Two things for me. One is empowerment. So if you really you have to give people the autonomy to act, but you also have to give them the information. So that really means transparency. You have to make sure you can't tell people You control this or you own this. They don't have all the information they need. And so that means total open book management. Everybody needs to understand the state of the company on a regular basis. I was struck, I was hiring somebody and asked in a sort of similar field, and I said, well, how big is the company? Well, I know how big my division is. I don't know what's going on with the whole company, which is hard to believe. But so making sure people have both the information and the real autonomy to make decisions. And then the other. piece is really understanding the whole, so you're dealing with a whole person. You're never just dealing with somebody who's sort of, especially these days, in a nine to five position. So recognizing they've got a family or they've got other pressures, other things they have to deal with and supporting them on every aspect of it. I had a director this week whose daughter was in a car accident. So I knew whenever I spoke with her, the first thing on her mind is, she had a concussion. How's your daughter doing? And just sort of starting with that rather than jumping right into business, expecting her to be able to shift gears really quick. Yeah, I mean, I didn't run a big company, and I intentionally kept it that way. But some things that stood out was I learned very early on that I can't expect anyone in my organization, unless they're my partner, to act as a partner or to care so much about the company like it's theirs. I think that's always kind of like this false notion that I want to find someone who is just as passionate about me. If they were, then they'd start their own company. That being said, there's not a reason why I can't treat them with the level of grace and security that they need to feel that I actually care. And I think that that's something that we did well. In my 14-year journey there, my average tenure of my team when I sold was nine years. And so I think it was great for a lot of them. It was their first job. And so I was really proud of that. And that, you know, we talk about being family. Not that I want them to be my family, but I wanted to treat them as somebody that I cared about. And I want them to know that. And whether it's like leveling them up or providing them resources to be able to level up, that's something I was very generous with. Because that's what I would have wanted if I were in a situation like that, helping someone experience their journey. build their brand and be a part of that. And so that's one thing that I would recommend is if you're in a leadership role, just think about it. If you're on the other side of that, like, how do they treat you? Do you want to be there? And not because you think it's your brand, but do you have that sense of ownership from the standpoint of this person has my back? And I think I did that pretty well. I think you heard great things from these folks. I second as somebody who had over 100,000 employees. Having done this, I think these guys... Can we get a round of applause for that? 100,000 employees? 125, but I think they speak to much of what matters. I will throw three things in. First, I would begin by telling yourself the truth. One of the foibles of management and leadership is we don't tell ourselves the truth. Second, the most fundamental role in an organization. is to help people understand what matters. And then third, no BS, get it done. And those are the three really operating principles of leadership. From there, I would say that as CEO, whether you're a one-person organization or you're an extraordinarily large company, the real issue is discovering today what's going to matter tomorrow. Because in our organizations, it can take days, weeks, months, and my kind of organization, years. to get there. So you better understand what's going to matter when you get there, and you better understand that today. And then the last thing, which I think you heard, as leader, I often think the role is more akin to being a parish priest or a rabbi than almost any other role. You're trying to help all of these folks whose priorities may be different to understand where are we coming from, where are we at, and what are the implications of different things we might do. on the future and you're trying to help people make that determination and then do the right things that are both in their interest and in the interest of the organization thank you all for all that advice um ron i want to ask you a specific question we're going to switch specific questions for a little bit if that's okay with all of you um you were known to annually write a pre-mortem in the form of a news story obituary or journal entry from that of the high school drew i'm not understanding okay ron you are known to annually write a pre-mortem in the form of a news story, obituary, or journal entry from that of the hypothetical future, looking back on your own endeavors. Can you speak on why you do this and how this has impacted your life and work? I mean, I think so much of what we do in business, and what you actually heard my colleagues speak to, begins in your own life. If you take it from there, it's often very helpful. And I found 30 and 35 years ago for me, I watched my parents both pass away. And I watched... One of them died with great peace and another one without as much peace. And I began to say, wow, the time to try to really figure that out is not in the ninth inning with two outs on your deathbed. The time, if you have the opportunity, is to think about it in your third inning, your fifth inning, your seventh inning. And I began to do that in my own life in terms of my own relationships with my body, my health, my relationships with my family, my relationships with my work. my relationships with my own spirituality. And I began to then say, let me figure out where I want to be, and then let me figure out what it's going to take me to get there, and then start to monitor myself on a quarterly basis whether I got there. And I began to say, this is actually working. And it began, I could feel it working for me, and I said, this is something I want to do in my business. And ultimately, that became a precept of which every enterprise that I've been involved with operates from. determining what it is three years, five years, and seven years from now we're going to respect, what is it we're going to want said about us, and then living our lives with key initiatives that allow us to get there. Thank you for that. Solomon, in operating 16 handles, you were continuously able to stay ahead of the curve and stay attuned to customer preferences and engagement, whether it was through pioneering 30-minute or less ice cream delivery, community-voted flavors, or staying tech-forward as an early adopter of toast and lunchbox. How were you able to do this? What tactics did you follow in order to give 16 Handles its competitive advantage? Yeah, so my brand building journey was really to build a next-gen brand, or really it was the millennial female. I mean, that's kind of how it came down. Our analytics showed very early on that 70% of those engaging with us on our loyalty program, following us on social, was very much that demographic. And so I thought, well, I'm not her, but I owe it to her to be able to have her follow me on my entrepreneurial journey by focusing on what's important for her life journey. And so in order to do that, I mean, with a small team, the actual tactics where I put myself out there, I mean, I kind of went out there with my real life MBA motive, which was I would visit various trade shows, summits, conventions, conferences, networking events. And really, that's how I was able to span beyond just even the quick service restaurant in the franchising industry and look at things like omni channel marketing, retail conferences where I'd be sitting next to retail experts from companies like L'Oreal or Home Depot. really being able to pick their brain and see how they at such a high level and a large footprint were able to make you know those decisions to be able to connect to their consumers and stay very relevant and so as I did that and again even in terms of like her lifestyle and her dietary journey and as she went from being a student at NYU where I started with my first location to now being maybe a mom in in Westchester County and understanding oh you know whether it be allergens and I think one of the one of the big things for us was when once we got to a point where instead of focusing on dietary restrictions we said you know what what do we what if we call the dietary celebrations right and so again like why don't we turn something negative i mean we're frozen dessert after all it should be a happy occasion right and so even in looking at it through that that's where things like working with oatly and what about made sense right so um you know i think once it's aligned with what our brand value was which was again to be that brand that she can count on throughout her life journey uh then she will remain loyal and allow us to be able to have the revenue to stay in business. And I think that becomes a symbiotic relationship. And so, again, even with the technology, it was, what is she doing to communicate? We were the first brand in the world to use Snapchat for an ad campaign before Snapchat became what it was. And again, it was really, and that wasn't my idea. I just approved it. It was a smart marketer on my team who said, hey, I think this is a growing platform. And I said, find a cheap way to use it, and I'll support it. And so I think, again, just. Just being committed to that on the brand side and knowing that my team is given a green light to focus on innovation, but be resourceful. We were bootstrapped the entire way. I didn't have outside investors, aside from mom and dad for the first location. So to me, I doubled and tripled down for 15 years. And then again, to the customer, it's let's listen to her. We would hold kind of a... I mean, they weren't really focus groups because we were doing it ourselves, but we'd invite them to our corporate office. We knew who our top customers were. And we'd want their advice. We'd sit them 20 at a time in our conference rooms and just ask them. And I think it was really that sort of commitment to staying true to, I want to be here for you and your needs because I don't know what they are. You ask my wife, she'll tell you, I don't know what the needs are. She has to tell me what they are. And so same thing with the customers. If we're going to stay committed to that, then they'll give us the answers. And I think throughout the growth journey, it's easy to get away from that. But I always try to make it an effort. And I would even tell my team guys, like, Once we feel that we think we know too much, let's go back to where the answers are. So I think that's what helped us along the way. Thank you. Seth, you famously founded Honest Tea with your former business school professor. How did you come to start the company with your professor out of all people, which I'm sure is relevant to a lot of people in this audience? Excuse me. And how were you able to keep the company honest and even further influence sustainability in your conglomerate after a 2011 sale to Coca-Cola? Yeah, there was a fun founding story. So it started in the classroom. We were doing a case study of Coke versus Pepsi. And Barry, who was my professor at the time, asked, you know, these big companies competing and selling brown fizzy liquid, is there any other way to compete? You know, my hand went up. Yeah, for sure. Not just it's not just about marketing campaigns. What about different sweetness levels, different ingredients? And we agreed. And at the time, Barry was excited. He said, let's do some focus groups. Let's make some drinks. And. And I was in my second year of business school, which a lot of you probably can relate to. I got to find a job, so I can't worry about that. It was only after I'd been out for a few years that I came back to the idea with that run. And after the run, I reached out to Barry and said, you know, that idea still makes there's still an opportunity there. And Barry had just come back from India where he'd been studying the tea industry and had come up with the name Honest Tea, which for me was like, okay, I get it. That's why that makes sense. And so we didn't know at the time when we started what Honest Tea would represent. We did have a statement around aspirations for social responsibility, but over time we became the first to make organic bottled tea. Obviously everything was just lightly sweetened, and then we were also the first to make Fairtrade certified bottled tea. And so as we scaled the business, we always talked about the missions in the bottle that's brewed into the product. And that made it easier as we became part of Coca-Cola to still keep those intrinsics intact. So the irony of what happened with Honesty is that Coke never compromised the integrity of the product, but they did mess up on the supply chain, just not able to keep it in stock. And so after the pandemic, Coke did a review of they were going to cut brands. They looked at it and said, Honest Tea is not growing, and so they cut Honest Tea, which at the time was really terribly disappointing for me and my family and all the thousands of people who had built Honest Tea. But then a week later we realized, well, that's a great opportunity because all of a sudden that marketplace, market space we had created is going to be void. And so we, within 90 days, launched Just Iced Tea. It's fantastic. I've been enjoying it all morning. And this is for both you, Peter and Seth. The previous shock and heightened growth of the plant-based meat category has slowed in recent years. And there has been significant debate on the future of refrigerated and frozen products in this segment. Peter, you previously stated that in the plant-based meat category, there's a competition problem, not a category problem. We saw plant-based meat sales fall almost 20% year-over-year in 2022, as many Americans lost feet. and the proposed health benefits of plant-based alternatives. Seth and Peter, how do you see the industry recovering or even resurging over the next 12 months and 10 years? Peter, can we start with you? Yeah, I think, I mean, there's a lot in there, by the way. Sorry. It's a confluence of things. It's totally fine. One is there's 200 plant-based companies in the U.S., right? I do retail every week. I've only seen about 40, but there's 200. And a lot of them are not great. ...scaled and the quality is not perfect. So people are coming into the category often through the wrong brand and the wrong food and that's leaving a bad taste in their mouth unintended. So those, a lot of those small companies are going out of business and there's a consolidation happening. When I, we called it Greek washing at some point. We made Greek yogurt so popular at Giovanni, everyone did it, all right? The Nordics people did it. There was German Greek yogurt. I was like, it's so confusing. There were Greek facials, Greek shampoo, Greek shampoo, yogurt shampoo. But there was 27 Greek strawberry yogurts and two sold. It was us and Dan. And it just confused the consumer, right? And the shelf was cold. It was congested. It was confusing. And it just stopped people from buying. And then if they did buy, they bought the wrong one. It didn't have the quality and the taste and the texture and the flavor. And so that's one piece of the puzzle. I think the other piece of the puzzle is... The category is young. It's too fragmented. We're all out for ourselves. And I don't think we've done sustained investment in the category. Right. And I'm not blaming anybody, because when you're trying to fight for your right and you're trying to keep your P&L intact, you've got to do what you've got to do. And often that is your own brand. But that's why the category itself is underpenetrated. The category itself is misunderstood. A lot of myths and misconceptions out there. So I don't think we've done the work as a category. It's a position it and really get across the value of it. And it's a complex value proposition, frankly, right? It tastes good. It's good for you. You don't kill animals. It's good for the planet. I mean, you know, we don't have infomercials here to be able to talk about for 25 minutes. So that's the second piece of it. And then the third piece of it, frankly, is, you know, we're going up against a, you know, it's a $2.5 billion category. Small. It's young, it's forming, but we're going up against $1.4 trillion animal industry. And they got a lot of money, they're a pain in the you-know-what, they're highly coordinated, they have extensive lobbying efforts. So Deep Pocket's coordinated and heavy in the lobby, and they're formidable, and they throw things out against us, right? They're afraid of us. They take often defensive postures and they threw things out like fake or faux or processed. They throw a lot of things out and most don't work but some stick. And the processed stock. See, that stuff's processed. I mean, animal beef is a class one carcinogen. I don't want to get into like a whole back and forth on it. So, you know, 70% of anything you buy in a grocery store is processed. Processed doesn't mean bad, but most people are busy. They don't know what... it just seems like a bad word when it comes to food. I mean, we're made from plants, you know, we're soy. Their pee is grown in the dirt, it's harvested, and it's anything but processed, right? It's amazing for you. It's got trace nutrients in it, it's got an excellent source of protein, it's got zero cholesterol. A Twinkie is freaking processed, you know, but it's stuck. And then there's the fourth thing I'll just say, there's some ignorance. And since we are in Washington, D.C., I have to be a little cheeky. So I was on the phone with the person who was then... third in line to the president so they can remain nameless no longer third in line to the president and i was asked to educate certain aspects of the government around plant-based and so i'm on the phone with this person um and he starts right away he's like he's like uh you're killing american jobs farming jobs and i was like what are you talking about i was just in decatur illinois where our soy is growing and i visited seven farms what do you mean we're supporting american jobs um We're a plant that's harvested in the United States. Then I said, oh, by the way, it's shipped to Chicago, L.A., and Oakland, two places that you were once in a state representing. So it's not only grown in America, because then he started saying, well, that shit's grown in China, and you're killing American jobs. I said, no, it's actually grown in the U.S., and it's made in the U.S. And he said, wow, that's crazy, all these misconceptions. Then it went, no, that crap's gone. in a lab. That's weird stuff. I said, no, no, no. This is plant-based. It's not lab-grown meat. So I was like, oh my God, this is like someone highly educated in the upper echelons of government where I just had to spend 20 minutes explaining that a plant is grown in the ground and harvested. So there's a lot of stuff out there. So we have to really coordinate and get the narrative straight and the story straight so that we can grow the category. I think that's our number one role. We want to grow individual brands, of course, but the category should be bigger if we're going to really impact climate and we're going to really impact people's lives. It's got to be much, much bigger. It can't be a $2.5 billion category. I agree with everything Peter said. And I would just reinforce, on the health side, the products absolutely, what you really need to do is look at just the health profile of the product. So less saturated fat, less cholesterol. So that we know is better. And then environmentally, you heard it in the previous speaker, the environmental footprint of animal-based protein is just, it's totally unsustainable for not just, you know, basically if we fed the rest of the world like the U.S. feeds itself, we'd need at least two and a half Earths. And last time I checked, we don't have that many. So we need to really change the environmental, whether it's the water consumption, land consumption. We make our products with about 97%. fewer resources than what it takes to grow animal-based meat. So we really, as a society and as a planet, don't have a choice. We have to move to more plant-based alternatives. And of course, if we can meet our dietary needs without having to have that footprint, why wouldn't we? So part of what we're doing is continuing to iterate on the taste profile and the ingredients in the product, but we also have to tell that health story. Beyond Meat, we have a product of Beyond Steak that just got endorsed by the American Heart Association, which is a big deal. It's the first time they've ever endorsed any kind of meat product. So we just need to continue to tell that story. And like Peter said, we don't view ourselves as competition. We really need to think about the meat industry, the animal-based meat industry is where the competition is. I mean, Seth said it well, just real quick. I mean, 1,300 gallons of water per one pound of beef. That's a lot of water. And we don't want to go into a rabbit hole. I mean, 70% of the Earth's usable land space is animal agriculture. It's been clear-cut, right? So all those trees cut. Where'd all those animals go? And so the environmental impact on, you know, vis-a-vis animal agriculture is vast, deep, profound, and bordering on irreversible, right? But the last thing I'll say, and I think Seth agrees, you can't get too technical. It's food. in the end of the day, right? So what's the number one trend in food, right? It is taste, period, right? Now, of course, there's protein and low sugar. There's all these little microtrends, but if it doesn't taste great, it's a non-starter. So what Beyond is doing, what Impossible is doing is really focus on constantly improving taste, texture, flavor of that food. It's hard to create a burger that mirrors the taste and texture of an animal burger. It's not easy, but we continuously improve that food. And when people think it's not a compromise. And it tastes as good, but it's much better for me with zero cholesterol and half the saturated fat. And oh, by the way, maybe further down the funnel, I'm doing some good in the world. I'm not killing an animal. And oh, by the way, it's probably better for the planet. That can become really powerful. Right? So the best days are yet to come, and it's incumbent upon us to really propel it forward. Thank you both. This wouldn't be Venture in the Capital if I didn't ask a venture-focused question. So, Ron, you served as the lead investor and are currently the chairman of Cabo. What fueled their breakout success and the unique opportunity for a successful IPO in the midst of the current IPO drought? Yeah, Cabo is probably the best restaurant IPO of the last three years. I think it starts first with having a business that's appropriate to be public. So many businesses seem to think that going public is the end, where going public is really just a starting point. My metaphor for it, it's like a wedding. You know, it's a wedding celebration, and people get very excited about the celebration, but what really matters is what happens in the relationship after the wedding celebration. So in Cava's case, this is a brand that is in a category, Mediterranean, that I think many people believe has the potential to be the next Mexican. It's bold flavors, it's intense flavors, it's powerful. Second, Cava has been built to be the dominant brand in that category. By size, it's larger than its next competitor by fivefold, and it has a very clear glide path to growth. Seth and I were talking earlier. In a public company, the market pays for growth. Your valuation is not driven by your earnings as much as the growth algorithm and what is the potential of that growth. And it's very easy for institutional investors to see that Kava has the potential and the path to be a thousand or more restaurants, simply reproducing what it's doing today. I think lastly, you have to have the right kind of management that's set up for it. We have an extraordinary CEO in Brett Schulman, we have a great CFO, and they have been training for now several years prior to the IPO to do what it takes to win in a public company, which is really to deliver for the institutional investors. I think you put all that together, plus we placed the stock with long-term investors, voided, how do I say, the hedge funds, that we're going to basically, not basically, we're going to clip it. We placed it with people we knew. T. Rowe Price, Capri, who are long-term investors, they've stuck with it, and this stock has more than doubled since then. And it's great food. By the way, that's the basis of it all, right? It's great food. It really is. And you need it. Ron, given we are focused on you, just one more question on venture. You've gone to start a VC fund, Act 3, that has invested in standout successes such as Capa. We think of it as a merchant. And Tate, can you speak on the fund's mandate? what you look for in portfolio companies and how you have translated your experience as an operator to advising your own portfolio companies? Sure. We want to be the partner that we want. So we operate with three principles. First, founder-friendly capital. That means when we go in, we don't want... Here's one of the big mistakes as a venture start. The idea that capital raising is a... annual life cycle event like a birthday the biggest mistake you make is to believe that your valuation along the way or even raising capital is anything about building a business what building a business is is building a better product the capital is a new business so when we go in We go in and we say we'll take all the follow-on rounds of your capital. We want to protect you so you can focus on being a better competitive alternative and avoid ever having to do another presentation to raise a dollar. So we invest, we invest, and then we take a right, a first refusal, which we've never turned down, and every follow-on round is capital. Can we talk after this? It's the right way, though. Don't we all agree? Yes. It's crazy what goes on. Number two. The second thing we do is, when we're in that boardroom, we're not talking about a liquidity. We've almost never sold anything. We're in that room talking about how do you build a better competitive alternative? How do you build a business that will dominate a category? What does that take? And of our 25 people, 24 of them are non-financial. They're strategic, they're real estate, they're operations, they're technology. They're there to help any of our investments. And we offer it to our investments on a cost-plus basis. And then the last thing that we do is we only invest where we have competitive advantage. Competitive advantage in business is there. We only invest where we know what's going to happen in the future. We invest in the food industry. We invest where we know how to help grow them, and we essentially avoid anything that is outside of our clear competitive advantage. Thank you. For a question back to all of you, can you each speak on the logistical difficulties of operating physical locations in major cities or distributing major cities, and how are you able to do so effectively? Peter, let's start with you. I think it's a little less relevant to us. We're a food manufacturer, right? We're distribution for you. Yeah. I mean, we're distributing to Walmart, you know, DC's and U.S. Cold Storage and Target and, you know, Safeway Albertsons and Kroger's. Look, logistics and distribution is a big cost to the business. It's actually not very environmentally friendly either. So the first thing, you know, we do is we try to get full trucks, right? And, you know, I know when I showed up at Impossible, I think about half of all of our orders. We're just partial truckloads, which is A, terrible for the environment, it's terrible for cost. And so you need scaled, full truckloads. You need a good distribution network, so we have about eight U.S. cold storage facilities that cuts down the amount of miles in a truck, which is A, better for the environment, and B, better for your cost structure. But we don't have a lot of cafes or restaurants and things like that. We're just distributing straight to grocery stores or food service locations. our food's being made or sold. But you have to be more efficient. It's one of those, you know, parts of the business. It's a necessary evil. And frankly, there's not a lot of innovation. You know, you're dealing with, you know, truck drivers, 18 wheelers, diesel fuel. I mean, you know, these DCs and warehouses are antiquated. Appointment times get bumped all the time and trucks sit around idle, just wasting fuel. polluting the environment, there's not a lot of innovation. It's tough. It's really, really tough. Seth, I know you and Plant Burger. Yeah, well, I actually was going to go more about what we do with Just Ice Tea. I think New York City is an example of an extremely competitive market. And our route to market is through, we work with a distributor called Big Geyser. And this is a distributor we worked with at Honest Tea as well. And so having someone on the ground who knows what they're doing is just a huge difference. Initially, when I launched Honest Tea, I was the distributor in New York, and I would drive up there in a van. I'd get parking tickets. I'd get just really a hassle. So when we finally got a distributor who knew the market, I sort of gave them a hug and never let go. And so once we got back in with Just Iced Tea, they said, well, take whatever you're selling and let's go. And we've already sold several million dollars of tea just in New York City. So. Having the right partners on the ground makes a huge difference. Solomon? Yeah, so I'll speak to that as well. So being in the franchise business, that was one of the main reasons why we stayed regional, right, in the tri-state. And I think that's overlooked a lot, especially in food and beverage franchising, where you have a great product. You may even have your own commissary. And, you know, I started in New York City, and let's say I get a call from Houston. This guy's like, I love your product. That was their own business. I want to open up five of these locations here. And so some of the mistakes that I've seen that I was fortunate able to avoid was to be able to overexpand past my distribution network. The other thing to keep in mind is, again, if I have 30 locations buying from one central facility or distributor in New York, and I have one location in Houston, Texas, I'm not getting that same pricing. And so, you know, learned that very early on. And then the other thing in terms of supply chain that I learned was, as Ron mentioned, kind of what's the competitive advantage. So I created my own. I started in 08. during the Froyo Wars, right? So there was nothing competitive that I had other than fine, I had the first mover advantage in New York City with the first self-serve model, but certainly wasn't a moat, just gave me a head start. And so one of the things I realized was that from a cost of goods perspective, if I wanted to focus on the best quality product, I was going to have to outspend my competitors. So the only other place I can save was going to be, well, two areas. One was labor, so self-serve addressed that. But then the second was going to be through our cost of goods from packaging and disposables. And so, you know, one of our things was we wanted to be a green company. So I created Greeno Products, and we essentially, you know, from overseas brought in paper products, hard plastic products. And so our spoons, lids, our cups, all these things were then imported and then distributed to our distributors. And so that did two things. It opened up our distribution network because then we had a lot of copycats that found out where 16 Handles got their cups and spoons from, which is great, right? Make money off your competition. I highly recommend it. But then that also allowed us to have a competitive edge to be able to sell to our franchisees where that's why you should choose us, right? We're thinking about these things. We're not just thinking about we're the best froyo makers. It's, you know, we're thinking about this from a business standpoint. And again, as somebody who didn't have. You know, let's say the luxury of being able to raise additional capital, I always had to turn that dollar of investment into more than that. So this constant mindset of ROI and cash on cash return, it was very sensitive to it. And that's ultimately how we were able to kind of maintain our mainstay in the Northeast. And yeah, so supply chain distribution with these things, you have to be very sensitive to. Two comments for you. First, I'd start and say this, grow in a concentric circle. One of the biggest mistakes is hopping all around. If you want success, grow from your strength and then expand. That's principle one. Second, principle number two, be contrary. I can remember when Kaba was first evolved. And, you know, they were here in D.C. and they followed another chain who went out from D.C. to L.A. They decided they had to go to L.A. Before I had made an investment and they were in LA and DC. And when I first met with Brett Shulman, who was the CEO, when we began to talk, I said, you're crazy. Why do you want to operate on both coasts? Doesn't matter what people think of you in West Hollywood. What matters is what people think of you in Fredericksburg, Virginia. And if you can win in Fredericksburg, Virginia, I can promise you there's a thousand locations in America. And the truth be told... That's what COPPA did. It focused on the suburbs while maintaining an urban presence. And that meant that as it went public, as we were just talking, it could show the world that it has the potential to be 1,000 plus stores, and it's a real potential driven by real data. Thank you. So given we're almost out of time, I'm going to ask you all two questions, and you can each pick one to answer. First, the agricultural and food industry is a notable driver of the climate crisis. An industry amounts to nearly a third of the planet's greenhouse gas emissions, with industrial animal production accounting for more than half that total. How are you adapting and advising your companies to continually address sustainability in their operations to meet a new generation of sustainability-focused consumers? That's the first question. Or how do you see the food and beverage industry evolving in the future? What is the top leading trend you are seeing from your vantage point? Ron, can we start with you? Sure. I'll take the second question. Where is this industry evolving? First, I'll be contrarian and tell you, it ain't changing. The restaurant industry is the second oldest profession in the world. There's a reason. It is. It is about... It works. Right, it works. It's about the fundamentals of hospitality. It's the fundamentals of caring. And so, it's not going to ultimately change in that sense. What you need to figure out and what we try to spend our time... figuring out is which categories within that industry five years from now are going to have tailwinds. And so I'll tell you what I believe is the future. I believe the future is in fact planned forward. 40% of Americans are trying to plan forward. Somebody is going to own that category. We have an investment in it. We have a concept in it called Life Alive. I believe that is the future. Secondly, I think Mediterranean is as powerful a category as you're going to get. That's why we went to Cava. That's why we got involved with Cava. That's why we helped them to grow. And they're the dominant category. I believe five years from now, you're still going to be talking about Mediterranean and you're going to be talking about Cava. Third, we have investments in much more upscale bakery cafes. I won't take you through it, but that's top ten. Many of you know it from here in DC. We believe that that has legs. Lastly, we're an immersive entertainment. I won't take you through that, but it's, again, another category. You see it emerging. It's the integration of both entertainment, often in a non-digital way, and food. And so my challenge to you is you want to know the future? You want to look at what excites you. You want to look at where the future, where people are going and what they're doing, and then how do you arrive when that future gets there? Thank you, Ron. Solomon? Yeah, so I'll answer the first one saying I ate an Impossible Burger for lunch before this. from the burger shop across my hotel. But also like Ron on the second question, I'm a firm believer that a lot of hurdles and friction that really separate the end consumer from what he or she wants in terms of the food, the meal, that's where the biggest innovation and change is going to come from. I've seen it in the last 15 years, even in my one concept. But just seeing that evolution of, again, whatever those obstacles may be, I think technology and automation plays a big role in that. I don't get so caught up in the minutiae of, well, is it ghost kitchens, is it that? To me, at the end of the day, it's remove those barriers and make yourself more accessible. And I think that will continue to be the trend. So first I want to give an unsolicited plug for Ron's book, Know What Matters. I read it just in the past few weeks, and it was like as soon as I was halfway through I ordered copies for all of my management team and my board because it's just such a so insightful and actionable. In terms of where I think things are going, part of this is where I hope things are going, which is towards a more values-driven food system, meaning you have to give people the information to make choices they care about, and then make sure you can market and brand and build those to be meaningful. I remember a few years ago, the CEO of a large restaurant company said something, our job is just to sell people what they want. And I'd like to think that we as companies can do better. We can actually help guide people's choices towards what can create a better world. And that's where I think the opportunities are. Thank you, Peter. Yeah, I mean, if you take that, I saw McDonald's. Did anyone see the quadruple Big Mac? They just, they brought it back by popular demand. I was like. Who's going to eat four? Anyway, maybe we shouldn't give everyone what they think they want. I'm sure some of the students in here could do it. But, look, I think from a macro perspective, I think one of the things you're seeing is a democratization of better choices in good food. I think good food is a right, not a privilege. And I think... The companies that are going to be on the right side of the trend and the truth are going to be able to develop a great product that tastes delicious, is high quality, and everyone can have it. So better food for more people. There's a lot of better food, and it's on the coasts, and it's at specialty stores, and it's price tag. And there's a lot of bad food that you all can buy. And so how do you get better food as accessible as the bad food out there with cleaner labels and more natural? more nutrient dense. And that's the future of food, democratizing better food and better options for people because it's a right, not a privilege, particularly in this country. And then look, things like, you know, high protein, low sugar, they're around to stay, you know, quality sources of protein. People are just constantly searching to eat high quality protein. But I would just echo what these guys said. I'm not going to answer the environmental one because, you know, Impossible, Beyond are inherently environmental companies. We don't have departments and ESG departments. like the product we make is inherently about it. But look, I think, you know, in the end of the day, you still have to make delicious food. You still have to make food that people want. But how do you make it exciting? How do you make it more available? How do you make it lower priced? How do you make it more accessible, I think, is the key to food making. And look, food's dominated by three or four major companies, right, that made, you know. food for the troops in the 1940s and World War II, right, and loaded them with preservatives and things like that. There's just no need to have food like that anymore. You don't need artificial flavors and colors and preservatives because we have a great supply chain, a cold supply chain now. That was critical to get to troops in the 40s. So I think food making is lazy. I think it's dominated by three or four major food companies that are yesterday's food companies. And I think they need to be challenged. I really do. And then the last thing I'll say is I do believe it's plant forward. People are going to incorporate more plant-based options into their diet for many reasons. It may be for they like the taste. It may be that they have high cholesterol and they want no cholesterol, so better for you. It may be because they don't like seeing animals slaughtered, or it may be because they want to reverse climate change and they see the environmental impact. where it may be that there's not enough animals to feed the world population, so it has to go that way anyway. So it's going to be all of those five or a few of those five, but the war, and look, we can debate what markets move faster and things like that, but what you can't debate is that the world be more plant-based moving forward. That's an undebatable thing. Growth curves, geographies, what goes first, Europe versus US, we can debate that till the cows come home. But it's going in that direction and I think we're kind of on the right side of the trend and truth on that one. Well, I can't thank you all enough for coming and go Hoyas. Hoyas Axa.

Ron makes his investments through Act III Holdings, a billion dollar plus evergreen investment vehicle. Seth Goldman is the co-founder and CEO of Eat the Change. that we've seen last Just Dice Tea, which you can try right outside of this auditorium.

Thank you, Seth. In addition, Seth is the co-founder of Plant Burger, a plant-based quick-serve restaurant, Honest Tea, and the chairman of Beyond Meat. Peter McGinnis is the CEO of Impossible Foods and was previously president and chief operating officer at Chobani, where he helped build the business into an iconic brand in his nine years at Chobani.

He also served as chief marketing and brand officer and chief commercial officer. And we have Solomon Choi. is the founder and former CEO of 16 Handles, New York City's first self-serve frozen yogurt shop, which he grew the company to over 40 locations internationally. He also co-founded Greeno Products and today through Jabba Brands, consults foreign investment early stage and emerging companies in food service, CPG and restaurant technology.

Thank you all for being here today. I'd love to start by asking you all to briefly introduce yourselves and tell us about your Perfect. Can you hear me? Yeah, I'd probably describe myself as an overnight success in 45 years. So I started out with a single cookie store in Boston, Massachusetts, coming out of business school in 1980. I ended up, that company became Au Bon Pain, Republic, that then became Panera Bread.

And it was sold for seven and a half billion dollars in 2017. Along the way we transformed the company four different times, which is really the interesting part. And having finished that I decided to put my money where my mouth is and help others do it. And that led to positions, majority positions in Tate, Life Alive, something called Level 99. And then we ultimately got very involved with Kava, the chairman there, and we helped them determine how to essentially build a dominant brand in a category.

And I guess I'd end by saying that what we do today is bet on categories. Discover today what's going to matter tomorrow. What are the categories that are going to matter? And make sure that we're positioned in those categories with the brand that will end up being the dominant. Yeah, tough act to follow.

I'm actually trying to be like Ron. That's my mission. Just live a few more years. But my journey is I moved to New York City in 2008, walking right into the subprime mortgage crisis and the Great Depression, as we know it, or the Great Recession, I should say. And bootstrapped 16 handles.

So I took a $600,000 investment from family, opened in Manhattan's East Village. And with my experience in having opened up restaurants and franchise development for other brands. I decided I wanted to, you know, part of that course of building a brand and was able to successfully do so. Grew the location to over 40 locations. We had international locations at one point.

So certainly got to enjoy that entrepreneurial journey over 14 and a half years. Exited the company in August of 2022. Got bought out by my largest franchisee and a YouTuber, Danny Duncan. I was not looking to sell at the time, but it was an offer I could not walk away from. It was millions, not billions like Ron. So again, I'm trying to work my way up there.

But similarly, along the way, and as of six years ago, I started advising and angel investing into startup companies in the CPG space, restaurants, as well as restaurant technology. I was really able to use restaurant technology to be able to outmaneuver a lot of my competition in terms of being able to get early adopting users in markets like New York City to essentially hold on to the highest average unit volumes in the category of frozen yogurt. 10 out of the 10 years that I franchised.

So very proud of that record. And yeah, and so here I'm now and, you know, hopefully we'll be able to connect with some of you here. Thank you. It's great to be here.

I'm based up in Bethesda, just up the street, but have been based in this area since 1995. I was initially came out of business school and went into the investment business. And then sort of after a presentation, one day I went for a run and I was thirsty and I went to a... beverage cooler and I said there's nothing here to drink and so I launched Honesty because I was thirsty.

I raised about five hundred thousand dollars from Friends and family and started brewing tea in my home, managed to get an appointment with Whole Foods where I had an empty Snapple bottle with a label pasted on it and five thermoses of tea that I presented to the buyer and managed to, you know, the buyer said we'll take 15,000 bottles, which for me was terrifying because I've never made it anywhere but my kitchen, and managed to sell it into the local Whole Foods stores here and then continue just to grow the brand through sampling. And by about 2007, we'd become the best-selling tea in the natural foods channel. And in 2008, we got reached out to by Coca-Cola, who invested and then bought the business in 2011. And I continued to stay involved with Honest Tea through 2019. But then in 2013, I got involved with a startup called Beyond Meat out in California that was seeking to really replicate the taste of meat using only plants, which... really resonated with me and my family.

We were all vegetarian and very frustrated with the choices. So I got involved as a board member and then executive chair of Beyond Meat and helped grow and scale the business. And I'm still chair of the board there today. And so, you know, all the different things I've worked in, I really regard as mission driven businesses where we're trying to change the environmental impact of food, trying to change the health impact of food, and also thinking about the footprint.

the labor involved. So everything we do it on is tea. Now with Just Ice Tea or Justice Tea, it's fair trade certified. And we've got some really exciting partnerships we're working on with tea growers around the world.

Yeah, Peter McGinnis spent about 20 years in advertising, interestingly. Ran agencies in Asia, Europe, Chicago, New York, built brands, built awareness, made companies more accessible to people, grew affinity. differentiated brands and then I was kind of just fed up with doing that and the industry had changed so much it was consolidating and it was you know big holding companies bought these really creative boutique shops and they were publicly traded kind of gutted the companies and restructured the companies and it just wasn't the same anymore so I went over to Chobani as chief marketing and brand officer and helped make that a lifestyle everyday brand I ended up running sales in addition to that, ended up becoming president, and then running the company, and loved it. And it was about, you know, Greek yogurt was 0.5% household penetration when I started.

It was 55 something when I left. No one wanted to eat Greek yogurt. And there's a lot of similarities to plant-based because it's small, right? So how do you make it accessible?

How do you make people aware of it? How do you inspire people in new and different ways to consume it? And that was a journey.

That was a nine-year journey. And it was great. And a lot of it was brand building.

A lot of it was just distribution. A lot of it was innovation. Things like Flip, which put nuts and seeds and dark chocolate in it.

And it was like kind of a gateway drug and, you know, Greek yogurt on training wheels, I used to call it. And it drove people into the category. And then I went over to Impossible again. Great brand, great product, you know, we're with Beyond, we don't compete with Beyond, you know, we're in the plant-based sector together and our role is to grow it together, but under-penetrated, right?

5-6% household penetration, 15% awareness, right? 94% of the country's never had an impossible burger, right? So that's what keeps me up at night, it's not the cynics, it's the opportunity.

85% of the country's never even heard of Impossible. You know, 900 total distribution points out of 9,000. So I think it's just getting started. So there's a lot of cynicism around this plant-based category, but it's in first gear.

You know, it's young and it's forming and it has so much opportunity ahead of itself and already people are giving up on it and being cynical, which is just ridiculous. But I got to get off my little soapbox and we'll talk about that later. Well, to start, we're seeing a rise in influencer-led brands like Emma Chamberlain's Chamberlain Coffee, Mr. B's Feastables, and Prime by Logan Paul and KSI.

In an industry as competitive and saturated as food and beverage, are you favoring partnerships with public figures or are you favoring other strategies to help compete? Can you provide an example of successful partnership, collaboration, or acquisition your company has been a part of? Let's start with Solomon, as I know you're an investor in Chamberlain Coffee. Yeah, so I am an investor. Love what Emma's doing.

Wish I was in miss Feastables as well. But I do believe that in terms of connecting with today's customer and really the next-gen consumer, that's really what they're looking for. And I think social media and technology has really kind of blurred the lines and given direct access.

I mean, when I think of direct-to-consumer... I think, you know, brands and offsets of people, people are brands. I'm friends with Josh Halperin, who's representing Shaquille O'Neal, kind of arguably one of the most recognizable faces on the planet, and he has his own burger chain now. Sorry, chicken chain in Big Chicken. Kevin Hart, who we all know, doing Hart House.

So I do think that the extension of one's brand, if it's truly authentic to who they are, their followers and the next gen will see, will want to support that and be a part of that journey. Conversely, I think that kind of influencer marketing, as I've seen over the last decade, has really evolved a lot. And I think that tactic in and of itself, when it doesn't resonate with the core values of the individual, especially the younger generation, they can sniff right through it. Right? That's a paid ad.

That's not real. They don't even do that. They don't even like that.

And so I think brands need to be careful about doing it. But when it works, it works really well. It is like a 10x force multiplier.

We did some at 16 Handles. I won't say anything that really moved the needle for us more so than with who we partnered with during the pandemic in launching Oatly. So we helped launch Oatly's soft serve product in 2021. And that was an opportunity for us to, again, align with a brand that we felt was kind of a challenger brand in a new category. Actually, coming from your record, we worked with Mike Messersmith, who Previously was the VP of Marketing at Chobani and then was the President of US at Oatly. And his family happened to live in the Upper West Side of Manhattan and were fans of 16 Handles, so that certainly helped.

But for us, it was really aligning our expansion from going from just Froyo to now wanting to own a broader category of soft serve. How do we do that in an organic and meaningful way? Well, why don't we line up with a brand that our customer base is really focusing on and wants?

It helped at the time also there was a national shortage because of... their partnership with Starbucks. You couldn't even get into Starbucks.

And so I think that was a great moment for us to be able to use that opportunity to help launch Oatly in a meaningful way that also kind of rose our brand in terms of top of mind at a time when our store is being self-serve. I mean, in 2020 and 2021, that's probably the last thing that you're looking into is anything self-serve. And so with our kind of omni-channel, you know, sales channels with delivery, we've been on all the delivery platforms since 2010. So I think, again, being an early adopter, being able to get closer to the customer really allowed us to, I remember positioning this way.

I mean, he laughed, but he understood. I said, hey, Mike, we're a SaaS product. He's like, you're a Froyo shop.

I was like, no, but we're soft serve as a service and we can do this for you. And so I remember like that led to us being able to pitch him. And quite honestly, I owe them a lot because they saved us during the pandemic.

I mean, we were able to secure half a million dollars from, you know, from that company with only 30 locations in the Northeast because we were able to show that we're able to reach that same demographic of consumer in a meaningful way and do it in a non-threatening way. And so that was kind of our experience in terms of working with brand. Ron? Yeah, I mean, I'm more negative and I'll explain to you why. I think when you talk about a brand, it's got to have integrity.

It's got to stand for something. It's got to stand for why its product deserves and belongs in the world, why it's a better alternative. And when you're using somebody else.

as the means to communicate that. You run the risk of both losing your own identity and you run the risk of ultimately succeeding in the short term for the wrong reasons. So I'm, and I know you expressed some cynicism, I'm ultimately very cynical. I can tell you this industry, my industry, food, is littered with folks that had names.

but didn't have the ability to deliver something behind it. Yeah, and I'll just chime in. I agree. Because ultimately, you're selling food.

So what a person says is, you know, as you said, people can be paid to say whatever. So ultimately, it's got to taste delicious. It's got to nurture somebody and provide the nutritional benefit or health benefit they're looking for. Of course, there's very little downside to someone saying something positive.

But to me, you know, when it's authentic, that's great. And, you know, when someone puts out a… shares a tweet and it's very funny we had president obama is it was and it is a big honesty and now just iced tea drinker and it's great because he talks about it on his own we obviously don't pay him anything to say that um so we love it when he does but he's not a paid spokesman for us yeah i think um i think brands have to stand on their own two feet first right and you need to build your brand based on the service you provide the products you make your value system your belief system If you want to amplify that from time to time with some influencers, that's okay, as long as you pick the right one. We didn't need to go down the Bud Light angle, and we certainly don't. I mean, there's a lot of professional athletes, you know, in the food space and in a lot of different spaces, and, you know, one... you know has a drug charge one pulls out a gun in a strip joint you know it just goes on and on and on and you're very vulnerable to it um and you know the reality we talk about jared the reality is when you when you when you pick an influencer or a spot or you're sponsoring somebody you don't really know that person and you're not in control so you've just relinquished control of your brand now it's risky so you There's two sides to that coin.

It's a total double-edged sword. So sometimes it works, and sometimes it's a really, really bad thing. So I'll just say I'm cautious, not cynical.

Well, thank you. To switch more to a leadership perspective, at Amazon, Jeff Bezos is known to start meetings with a six-page narrative memo followed by 30 minutes of study hall. He also believes that the most senior person in a meeting should speak last. At Slack, the motto, work hard and go home, is painted all over the walls. With this in mind, all of you have assumed leadership positions in quite sizable companies.

What is the single most crucial thing you have learned about leadership and are there specific and unique ways you implement this? Peter, let's start with you. Yeah, I can't do six-page memos.

I have ADD. But, no, I think you just have to be present, you know. That's a literal and a figurative term. I think you need to be present, you know.

text, on email, in the office. Be it showing up is probably one of the most important things you can do. And you have to lead by example.

So of course you have to work hard. Of course you have to collaborate. I also think you don't need to be the smartest person in the room.

Have a little bit of security and have a little bit of confidence so that you can let other people speak. I don't think you have to. make it like a rule that the most senior person speaks last, you should just behave in a meeting and not try to get the last word in and not try to be the smartest person in the room.

I also think leaders are just, the more humanity you have, the better. So just be generous. Be generous with your time. Be generous with your lessons.

Be generous with trying to teach people that work for you. So generosity, I think, is super important. And then I think our role as leaders is we're evaluated on how well the people report to us do, not how well we do.

You already have the top jobs. You have nothing to prove. So you should be evaluated based on how well the people below you do as a leader. And that should be 100% your evaluation.

So therefore, you have to be there for them. You have to be present. You have to be generous.

And you definitely have to be more of a servant leader. And I think that's it's an overused term, but I think it's incredibly important. And that's my kind of perspective on it.

I don't have hard, fast rules. It's just be human and don't be a jerk. Two things for me.

One is empowerment. So if you really you have to give people the autonomy to act, but you also have to give them the information. So that really means transparency. You have to make sure you can't tell people You control this or you own this.

They don't have all the information they need. And so that means total open book management. Everybody needs to understand the state of the company on a regular basis.

I was struck, I was hiring somebody and asked in a sort of similar field, and I said, well, how big is the company? Well, I know how big my division is. I don't know what's going on with the whole company, which is hard to believe.

But so making sure people have both the information and the real autonomy to make decisions. And then the other. piece is really understanding the whole, so you're dealing with a whole person. You're never just dealing with somebody who's sort of, especially these days, in a nine to five position. So recognizing they've got a family or they've got other pressures, other things they have to deal with and supporting them on every aspect of it.

I had a director this week whose daughter was in a car accident. So I knew whenever I spoke with her, the first thing on her mind is, she had a concussion. How's your daughter doing?

And just sort of starting with that rather than jumping right into business, expecting her to be able to shift gears really quick. Yeah, I mean, I didn't run a big company, and I intentionally kept it that way. But some things that stood out was I learned very early on that I can't expect anyone in my organization, unless they're my partner, to act as a partner or to care so much about the company like it's theirs.

I think that's always kind of like this false notion that I want to find someone who is just as passionate about me. If they were, then they'd start their own company. That being said, there's not a reason why I can't treat them with the level of grace and security that they need to feel that I actually care.

And I think that that's something that we did well. In my 14-year journey there, my average tenure of my team when I sold was nine years. And so I think it was great for a lot of them.

It was their first job. And so I was really proud of that. And that, you know, we talk about being family. Not that I want them to be my family, but I wanted to treat them as somebody that I cared about. And I want them to know that.

And whether it's like leveling them up or providing them resources to be able to level up, that's something I was very generous with. Because that's what I would have wanted if I were in a situation like that, helping someone experience their journey. build their brand and be a part of that. And so that's one thing that I would recommend is if you're in a leadership role, just think about it. If you're on the other side of that, like, how do they treat you?

Do you want to be there? And not because you think it's your brand, but do you have that sense of ownership from the standpoint of this person has my back? And I think I did that pretty well.

I think you heard great things from these folks. I second as somebody who had over 100,000 employees. Having done this, I think these guys... Can we get a round of applause for that? 100,000 employees?

125, but I think they speak to much of what matters. I will throw three things in. First, I would begin by telling yourself the truth. One of the foibles of management and leadership is we don't tell ourselves the truth. Second, the most fundamental role in an organization.

is to help people understand what matters. And then third, no BS, get it done. And those are the three really operating principles of leadership.

From there, I would say that as CEO, whether you're a one-person organization or you're an extraordinarily large company, the real issue is discovering today what's going to matter tomorrow. Because in our organizations, it can take days, weeks, months, and my kind of organization, years. to get there. So you better understand what's going to matter when you get there, and you better understand that today.

And then the last thing, which I think you heard, as leader, I often think the role is more akin to being a parish priest or a rabbi than almost any other role. You're trying to help all of these folks whose priorities may be different to understand where are we coming from, where are we at, and what are the implications of different things we might do. on the future and you're trying to help people make that determination and then do the right things that are both in their interest and in the interest of the organization thank you all for all that advice um ron i want to ask you a specific question we're going to switch specific questions for a little bit if that's okay with all of you um you were known to annually write a pre-mortem in the form of a news story obituary or journal entry from that of the high school drew i'm not understanding okay ron you are known to annually write a pre-mortem in the form of a news story, obituary, or journal entry from that of the hypothetical future, looking back on your own endeavors. Can you speak on why you do this and how this has impacted your life and work?

I mean, I think so much of what we do in business, and what you actually heard my colleagues speak to, begins in your own life. If you take it from there, it's often very helpful. And I found 30 and 35 years ago for me, I watched my parents both pass away. And I watched... One of them died with great peace and another one without as much peace.

And I began to say, wow, the time to try to really figure that out is not in the ninth inning with two outs on your deathbed. The time, if you have the opportunity, is to think about it in your third inning, your fifth inning, your seventh inning. And I began to do that in my own life in terms of my own relationships with my body, my health, my relationships with my family, my relationships with my work. my relationships with my own spirituality. And I began to then say, let me figure out where I want to be, and then let me figure out what it's going to take me to get there, and then start to monitor myself on a quarterly basis whether I got there.

And I began to say, this is actually working. And it began, I could feel it working for me, and I said, this is something I want to do in my business. And ultimately, that became a precept of which every enterprise that I've been involved with operates from.

determining what it is three years, five years, and seven years from now we're going to respect, what is it we're going to want said about us, and then living our lives with key initiatives that allow us to get there. Thank you for that. Solomon, in operating 16 handles, you were continuously able to stay ahead of the curve and stay attuned to customer preferences and engagement, whether it was through pioneering 30-minute or less ice cream delivery, community-voted flavors, or staying tech-forward as an early adopter of toast and lunchbox. How were you able to do this? What tactics did you follow in order to give 16 Handles its competitive advantage?

Yeah, so my brand building journey was really to build a next-gen brand, or really it was the millennial female. I mean, that's kind of how it came down. Our analytics showed very early on that 70% of those engaging with us on our loyalty program, following us on social, was very much that demographic.

And so I thought, well, I'm not her, but I owe it to her to be able to have her follow me on my entrepreneurial journey by focusing on what's important for her life journey. And so in order to do that, I mean, with a small team, the actual tactics where I put myself out there, I mean, I kind of went out there with my real life MBA motive, which was I would visit various trade shows, summits, conventions, conferences, networking events. And really, that's how I was able to span beyond just even the quick service restaurant in the franchising industry and look at things like omni channel marketing, retail conferences where I'd be sitting next to retail experts from companies like L'Oreal or Home Depot. really being able to pick their brain and see how they at such a high level and a large footprint were able to make you know those decisions to be able to connect to their consumers and stay very relevant and so as I did that and again even in terms of like her lifestyle and her dietary journey and as she went from being a student at NYU where I started with my first location to now being maybe a mom in in Westchester County and understanding oh you know whether it be allergens and I think one of the one of the big things for us was when once we got to a point where instead of focusing on dietary restrictions we said you know what what do we what if we call the dietary celebrations right and so again like why don't we turn something negative i mean we're frozen dessert after all it should be a happy occasion right and so even in looking at it through that that's where things like working with oatly and what about made sense right so um you know i think once it's aligned with what our brand value was which was again to be that brand that she can count on throughout her life journey uh then she will remain loyal and allow us to be able to have the revenue to stay in business.

And I think that becomes a symbiotic relationship. And so, again, even with the technology, it was, what is she doing to communicate? We were the first brand in the world to use Snapchat for an ad campaign before Snapchat became what it was. And again, it was really, and that wasn't my idea. I just approved it.

It was a smart marketer on my team who said, hey, I think this is a growing platform. And I said, find a cheap way to use it, and I'll support it. And so I think, again, just.

Just being committed to that on the brand side and knowing that my team is given a green light to focus on innovation, but be resourceful. We were bootstrapped the entire way. I didn't have outside investors, aside from mom and dad for the first location. So to me, I doubled and tripled down for 15 years.

And then again, to the customer, it's let's listen to her. We would hold kind of a... I mean, they weren't really focus groups because we were doing it ourselves, but we'd invite them to our corporate office.

We knew who our top customers were. And we'd want their advice. We'd sit them 20 at a time in our conference rooms and just ask them. And I think it was really that sort of commitment to staying true to, I want to be here for you and your needs because I don't know what they are. You ask my wife, she'll tell you, I don't know what the needs are.

She has to tell me what they are. And so same thing with the customers. If we're going to stay committed to that, then they'll give us the answers.

And I think throughout the growth journey, it's easy to get away from that. But I always try to make it an effort. And I would even tell my team guys, like, Once we feel that we think we know too much, let's go back to where the answers are.

So I think that's what helped us along the way. Thank you. Seth, you famously founded Honest Tea with your former business school professor. How did you come to start the company with your professor out of all people, which I'm sure is relevant to a lot of people in this audience? Excuse me.

And how were you able to keep the company honest and even further influence sustainability in your conglomerate after a 2011 sale to Coca-Cola? Yeah, there was a fun founding story. So it started in the classroom.

We were doing a case study of Coke versus Pepsi. And Barry, who was my professor at the time, asked, you know, these big companies competing and selling brown fizzy liquid, is there any other way to compete? You know, my hand went up.

Yeah, for sure. Not just it's not just about marketing campaigns. What about different sweetness levels, different ingredients?

And we agreed. And at the time, Barry was excited. He said, let's do some focus groups.

Let's make some drinks. And. And I was in my second year of business school, which a lot of you probably can relate to. I got to find a job, so I can't worry about that.

It was only after I'd been out for a few years that I came back to the idea with that run. And after the run, I reached out to Barry and said, you know, that idea still makes there's still an opportunity there. And Barry had just come back from India where he'd been studying the tea industry and had come up with the name Honest Tea, which for me was like, okay, I get it.

That's why that makes sense. And so we didn't know at the time when we started what Honest Tea would represent. We did have a statement around aspirations for social responsibility, but over time we became the first to make organic bottled tea. Obviously everything was just lightly sweetened, and then we were also the first to make Fairtrade certified bottled tea. And so as we scaled the business, we always talked about the missions in the bottle that's brewed into the product.

And that made it easier as we became part of Coca-Cola to still keep those intrinsics intact. So the irony of what happened with Honesty is that Coke never compromised the integrity of the product, but they did mess up on the supply chain, just not able to keep it in stock. And so after the pandemic, Coke did a review of they were going to cut brands.

They looked at it and said, Honest Tea is not growing, and so they cut Honest Tea, which at the time was really terribly disappointing for me and my family and all the thousands of people who had built Honest Tea. But then a week later we realized, well, that's a great opportunity because all of a sudden that marketplace, market space we had created is going to be void. And so we, within 90 days, launched Just Iced Tea. It's fantastic. I've been enjoying it all morning.

And this is for both you, Peter and Seth. The previous shock and heightened growth of the plant-based meat category has slowed in recent years. And there has been significant debate on the future of refrigerated and frozen products in this segment. Peter, you previously stated that in the plant-based meat category, there's a competition problem, not a category problem.

We saw plant-based meat sales fall almost 20% year-over-year in 2022, as many Americans lost feet. and the proposed health benefits of plant-based alternatives. Seth and Peter, how do you see the industry recovering or even resurging over the next 12 months and 10 years?

Peter, can we start with you? Yeah, I think, I mean, there's a lot in there, by the way. Sorry.

It's a confluence of things. It's totally fine. One is there's 200 plant-based companies in the U.S., right? I do retail every week. I've only seen about 40, but there's 200. And a lot of them are not great.

...scaled and the quality is not perfect. So people are coming into the category often through the wrong brand and the wrong food and that's leaving a bad taste in their mouth unintended. So those, a lot of those small companies are going out of business and there's a consolidation happening. When I, we called it Greek washing at some point. We made Greek yogurt so popular at Giovanni, everyone did it, all right?

The Nordics people did it. There was German Greek yogurt. I was like, it's so confusing.

There were Greek facials, Greek shampoo, Greek shampoo, yogurt shampoo. But there was 27 Greek strawberry yogurts and two sold. It was us and Dan. And it just confused the consumer, right?

And the shelf was cold. It was congested. It was confusing.

And it just stopped people from buying. And then if they did buy, they bought the wrong one. It didn't have the quality and the taste and the texture and the flavor.

And so that's one piece of the puzzle. I think the other piece of the puzzle is... The category is young.

It's too fragmented. We're all out for ourselves. And I don't think we've done sustained investment in the category.

Right. And I'm not blaming anybody, because when you're trying to fight for your right and you're trying to keep your P&L intact, you've got to do what you've got to do. And often that is your own brand.

But that's why the category itself is underpenetrated. The category itself is misunderstood. A lot of myths and misconceptions out there.

So I don't think we've done the work as a category. It's a position it and really get across the value of it. And it's a complex value proposition, frankly, right? It tastes good.

It's good for you. You don't kill animals. It's good for the planet.

I mean, you know, we don't have infomercials here to be able to talk about for 25 minutes. So that's the second piece of it. And then the third piece of it, frankly, is, you know, we're going up against a, you know, it's a $2.5 billion category.

Small. It's young, it's forming, but we're going up against $1.4 trillion animal industry. And they got a lot of money, they're a pain in the you-know-what, they're highly coordinated, they have extensive lobbying efforts.

So Deep Pocket's coordinated and heavy in the lobby, and they're formidable, and they throw things out against us, right? They're afraid of us. They take often defensive postures and they threw things out like fake or faux or processed.

They throw a lot of things out and most don't work but some stick. And the processed stock. See, that stuff's processed.

I mean, animal beef is a class one carcinogen. I don't want to get into like a whole back and forth on it. So, you know, 70% of anything you buy in a grocery store is processed.

Processed doesn't mean bad, but most people are busy. They don't know what... it just seems like a bad word when it comes to food. I mean, we're made from plants, you know, we're soy. Their pee is grown in the dirt, it's harvested, and it's anything but processed, right?

It's amazing for you. It's got trace nutrients in it, it's got an excellent source of protein, it's got zero cholesterol. A Twinkie is freaking processed, you know, but it's stuck. And then there's the fourth thing I'll just say, there's some ignorance. And since we are in Washington, D.C., I have to be a little cheeky.

So I was on the phone with the person who was then... third in line to the president so they can remain nameless no longer third in line to the president and i was asked to educate certain aspects of the government around plant-based and so i'm on the phone with this person um and he starts right away he's like he's like uh you're killing american jobs farming jobs and i was like what are you talking about i was just in decatur illinois where our soy is growing and i visited seven farms what do you mean we're supporting american jobs um We're a plant that's harvested in the United States. Then I said, oh, by the way, it's shipped to Chicago, L.A., and Oakland, two places that you were once in a state representing.

So it's not only grown in America, because then he started saying, well, that shit's grown in China, and you're killing American jobs. I said, no, it's actually grown in the U.S., and it's made in the U.S. And he said, wow, that's crazy, all these misconceptions.

Then it went, no, that crap's gone. in a lab. That's weird stuff.

I said, no, no, no. This is plant-based. It's not lab-grown meat.

So I was like, oh my God, this is like someone highly educated in the upper echelons of government where I just had to spend 20 minutes explaining that a plant is grown in the ground and harvested. So there's a lot of stuff out there. So we have to really coordinate and get the narrative straight and the story straight so that we can grow the category. I think that's our number one role. We want to grow individual brands, of course, but the category should be bigger if we're going to really impact climate and we're going to really impact people's lives.

It's got to be much, much bigger. It can't be a $2.5 billion category. I agree with everything Peter said.

And I would just reinforce, on the health side, the products absolutely, what you really need to do is look at just the health profile of the product. So less saturated fat, less cholesterol. So that we know is better.

And then environmentally, you heard it in the previous speaker, the environmental footprint of animal-based protein is just, it's totally unsustainable for not just, you know, basically if we fed the rest of the world like the U.S. feeds itself, we'd need at least two and a half Earths. And last time I checked, we don't have that many. So we need to really change the environmental, whether it's the water consumption, land consumption. We make our products with about 97%.

fewer resources than what it takes to grow animal-based meat. So we really, as a society and as a planet, don't have a choice. We have to move to more plant-based alternatives. And of course, if we can meet our dietary needs without having to have that footprint, why wouldn't we? So part of what we're doing is continuing to iterate on the taste profile and the ingredients in the product, but we also have to tell that health story.

Beyond Meat, we have a product of Beyond Steak that just got endorsed by the American Heart Association, which is a big deal. It's the first time they've ever endorsed any kind of meat product. So we just need to continue to tell that story. And like Peter said, we don't view ourselves as competition. We really need to think about the meat industry, the animal-based meat industry is where the competition is.

I mean, Seth said it well, just real quick. I mean, 1,300 gallons of water per one pound of beef. That's a lot of water.

And we don't want to go into a rabbit hole. I mean, 70% of the Earth's usable land space is animal agriculture. It's been clear-cut, right?

So all those trees cut. Where'd all those animals go? And so the environmental impact on, you know, vis-a-vis animal agriculture is vast, deep, profound, and bordering on irreversible, right? But the last thing I'll say, and I think Seth agrees, you can't get too technical. It's food.

in the end of the day, right? So what's the number one trend in food, right? It is taste, period, right? Now, of course, there's protein and low sugar.

There's all these little microtrends, but if it doesn't taste great, it's a non-starter. So what Beyond is doing, what Impossible is doing is really focus on constantly improving taste, texture, flavor of that food. It's hard to create a burger that mirrors the taste and texture of an animal burger. It's not easy, but we continuously improve that food.

And when people think it's not a compromise. And it tastes as good, but it's much better for me with zero cholesterol and half the saturated fat. And oh, by the way, maybe further down the funnel, I'm doing some good in the world.

I'm not killing an animal. And oh, by the way, it's probably better for the planet. That can become really powerful.

Right? So the best days are yet to come, and it's incumbent upon us to really propel it forward. Thank you both. This wouldn't be Venture in the Capital if I didn't ask a venture-focused question. So, Ron, you served as the lead investor and are currently the chairman of Cabo.

What fueled their breakout success and the unique opportunity for a successful IPO in the midst of the current IPO drought? Yeah, Cabo is probably the best restaurant IPO of the last three years. I think it starts first with having a business that's appropriate to be public.

So many businesses seem to think that going public is the end, where going public is really just a starting point. My metaphor for it, it's like a wedding. You know, it's a wedding celebration, and people get very excited about the celebration, but what really matters is what happens in the relationship after the wedding celebration. So in Cava's case, this is a brand that is in a category, Mediterranean, that I think many people believe has the potential to be the next Mexican.

It's bold flavors, it's intense flavors, it's powerful. Second, Cava has been built to be the dominant brand in that category. By size, it's larger than its next competitor by fivefold, and it has a very clear glide path to growth.

Seth and I were talking earlier. In a public company, the market pays for growth. Your valuation is not driven by your earnings as much as the growth algorithm and what is the potential of that growth.

And it's very easy for institutional investors to see that Kava has the potential and the path to be a thousand or more restaurants, simply reproducing what it's doing today. I think lastly, you have to have the right kind of management that's set up for it. We have an extraordinary CEO in Brett Schulman, we have a great CFO, and they have been training for now several years prior to the IPO to do what it takes to win in a public company, which is really to deliver for the institutional investors. I think you put all that together, plus we placed the stock with long-term investors, voided, how do I say, the hedge funds, that we're going to basically, not basically, we're going to clip it. We placed it with people we knew.

T. Rowe Price, Capri, who are long-term investors, they've stuck with it, and this stock has more than doubled since then. And it's great food. By the way, that's the basis of it all, right?

It's great food. It really is. And you need it.

Ron, given we are focused on you, just one more question on venture. You've gone to start a VC fund, Act 3, that has invested in standout successes such as Capa. We think of it as a merchant. And Tate, can you speak on the fund's mandate?

what you look for in portfolio companies and how you have translated your experience as an operator to advising your own portfolio companies? Sure. We want to be the partner that we want. So we operate with three principles.

First, founder-friendly capital. That means when we go in, we don't want... Here's one of the big mistakes as a venture start. The idea that capital raising is a...

annual life cycle event like a birthday the biggest mistake you make is to believe that your valuation along the way or even raising capital is anything about building a business what building a business is is building a better product the capital is a new business so when we go in We go in and we say we'll take all the follow-on rounds of your capital. We want to protect you so you can focus on being a better competitive alternative and avoid ever having to do another presentation to raise a dollar. So we invest, we invest, and then we take a right, a first refusal, which we've never turned down, and every follow-on round is capital.

Can we talk after this? It's the right way, though. Don't we all agree?

Yes. It's crazy what goes on. Number two. The second thing we do is, when we're in that boardroom, we're not talking about a liquidity. We've almost never sold anything.

We're in that room talking about how do you build a better competitive alternative? How do you build a business that will dominate a category? What does that take?

And of our 25 people, 24 of them are non-financial. They're strategic, they're real estate, they're operations, they're technology. They're there to help any of our investments.

And we offer it to our investments on a cost-plus basis. And then the last thing that we do is we only invest where we have competitive advantage. Competitive advantage in business is there.

We only invest where we know what's going to happen in the future. We invest in the food industry. We invest where we know how to help grow them, and we essentially avoid anything that is outside of our clear competitive advantage.

Thank you. For a question back to all of you, can you each speak on the logistical difficulties of operating physical locations in major cities or distributing major cities, and how are you able to do so effectively? Peter, let's start with you. I think it's a little less relevant to us.

We're a food manufacturer, right? We're distribution for you. Yeah.

I mean, we're distributing to Walmart, you know, DC's and U.S. Cold Storage and Target and, you know, Safeway Albertsons and Kroger's. Look, logistics and distribution is a big cost to the business.

It's actually not very environmentally friendly either. So the first thing, you know, we do is we try to get full trucks, right? And, you know, I know when I showed up at Impossible, I think about half of all of our orders.

We're just partial truckloads, which is A, terrible for the environment, it's terrible for cost. And so you need scaled, full truckloads. You need a good distribution network, so we have about eight U.S. cold storage facilities that cuts down the amount of miles in a truck, which is A, better for the environment, and B, better for your cost structure. But we don't have a lot of cafes or restaurants and things like that.

We're just distributing straight to grocery stores or food service locations. our food's being made or sold. But you have to be more efficient. It's one of those, you know, parts of the business. It's a necessary evil.

And frankly, there's not a lot of innovation. You know, you're dealing with, you know, truck drivers, 18 wheelers, diesel fuel. I mean, you know, these DCs and warehouses are antiquated.

Appointment times get bumped all the time and trucks sit around idle, just wasting fuel. polluting the environment, there's not a lot of innovation. It's tough. It's really, really tough. Seth, I know you and Plant Burger.

Yeah, well, I actually was going to go more about what we do with Just Ice Tea. I think New York City is an example of an extremely competitive market. And our route to market is through, we work with a distributor called Big Geyser.

And this is a distributor we worked with at Honest Tea as well. And so having someone on the ground who knows what they're doing is just a huge difference. Initially, when I launched Honest Tea, I was the distributor in New York, and I would drive up there in a van.

I'd get parking tickets. I'd get just really a hassle. So when we finally got a distributor who knew the market, I sort of gave them a hug and never let go. And so once we got back in with Just Iced Tea, they said, well, take whatever you're selling and let's go.

And we've already sold several million dollars of tea just in New York City. So. Having the right partners on the ground makes a huge difference. Solomon?

Yeah, so I'll speak to that as well. So being in the franchise business, that was one of the main reasons why we stayed regional, right, in the tri-state. And I think that's overlooked a lot, especially in food and beverage franchising, where you have a great product.

You may even have your own commissary. And, you know, I started in New York City, and let's say I get a call from Houston. This guy's like, I love your product. That was their own business.

I want to open up five of these locations here. And so some of the mistakes that I've seen that I was fortunate able to avoid was to be able to overexpand past my distribution network. The other thing to keep in mind is, again, if I have 30 locations buying from one central facility or distributor in New York, and I have one location in Houston, Texas, I'm not getting that same pricing.

And so, you know, learned that very early on. And then the other thing in terms of supply chain that I learned was, as Ron mentioned, kind of what's the competitive advantage. So I created my own.

I started in 08. during the Froyo Wars, right? So there was nothing competitive that I had other than fine, I had the first mover advantage in New York City with the first self-serve model, but certainly wasn't a moat, just gave me a head start. And so one of the things I realized was that from a cost of goods perspective, if I wanted to focus on the best quality product, I was going to have to outspend my competitors. So the only other place I can save was going to be, well, two areas. One was labor, so self-serve addressed that.

But then the second was going to be through our cost of goods from packaging and disposables. And so, you know, one of our things was we wanted to be a green company. So I created Greeno Products, and we essentially, you know, from overseas brought in paper products, hard plastic products. And so our spoons, lids, our cups, all these things were then imported and then distributed to our distributors.

And so that did two things. It opened up our distribution network because then we had a lot of copycats that found out where 16 Handles got their cups and spoons from, which is great, right? Make money off your competition. I highly recommend it. But then that also allowed us to have a competitive edge to be able to sell to our franchisees where that's why you should choose us, right?

We're thinking about these things. We're not just thinking about we're the best froyo makers. It's, you know, we're thinking about this from a business standpoint. And again, as somebody who didn't have. You know, let's say the luxury of being able to raise additional capital, I always had to turn that dollar of investment into more than that.

So this constant mindset of ROI and cash on cash return, it was very sensitive to it. And that's ultimately how we were able to kind of maintain our mainstay in the Northeast. And yeah, so supply chain distribution with these things, you have to be very sensitive to.

Two comments for you. First, I'd start and say this, grow in a concentric circle. One of the biggest mistakes is hopping all around.

If you want success, grow from your strength and then expand. That's principle one. Second, principle number two, be contrary.

I can remember when Kaba was first evolved. And, you know, they were here in D.C. and they followed another chain who went out from D.C.

to L.A. They decided they had to go to L.A. Before I had made an investment and they were in LA and DC. And when I first met with Brett Shulman, who was the CEO, when we began to talk, I said, you're crazy.

Why do you want to operate on both coasts? Doesn't matter what people think of you in West Hollywood. What matters is what people think of you in Fredericksburg, Virginia.

And if you can win in Fredericksburg, Virginia, I can promise you there's a thousand locations in America. And the truth be told... That's what COPPA did.

It focused on the suburbs while maintaining an urban presence. And that meant that as it went public, as we were just talking, it could show the world that it has the potential to be 1,000 plus stores, and it's a real potential driven by real data. Thank you.

So given we're almost out of time, I'm going to ask you all two questions, and you can each pick one to answer. First, the agricultural and food industry is a notable driver of the climate crisis. An industry amounts to nearly a third of the planet's greenhouse gas emissions, with industrial animal production accounting for more than half that total. How are you adapting and advising your companies to continually address sustainability in their operations to meet a new generation of sustainability-focused consumers? That's the first question.

Or how do you see the food and beverage industry evolving in the future? What is the top leading trend you are seeing from your vantage point? Ron, can we start with you? Sure. I'll take the second question.

Where is this industry evolving? First, I'll be contrarian and tell you, it ain't changing. The restaurant industry is the second oldest profession in the world.

There's a reason. It is. It is about... It works.

Right, it works. It's about the fundamentals of hospitality. It's the fundamentals of caring.

And so, it's not going to ultimately change in that sense. What you need to figure out and what we try to spend our time... figuring out is which categories within that industry five years from now are going to have tailwinds.

And so I'll tell you what I believe is the future. I believe the future is in fact planned forward. 40% of Americans are trying to plan forward. Somebody is going to own that category.

We have an investment in it. We have a concept in it called Life Alive. I believe that is the future.

Secondly, I think Mediterranean is as powerful a category as you're going to get. That's why we went to Cava. That's why we got involved with Cava.

That's why we helped them to grow. And they're the dominant category. I believe five years from now, you're still going to be talking about Mediterranean and you're going to be talking about Cava.

Third, we have investments in much more upscale bakery cafes. I won't take you through it, but that's top ten. Many of you know it from here in DC. We believe that that has legs.

Lastly, we're an immersive entertainment. I won't take you through that, but it's, again, another category. You see it emerging.

It's the integration of both entertainment, often in a non-digital way, and food. And so my challenge to you is you want to know the future? You want to look at what excites you. You want to look at where the future, where people are going and what they're doing, and then how do you arrive when that future gets there?

Thank you, Ron. Solomon? Yeah, so I'll answer the first one saying I ate an Impossible Burger for lunch before this. from the burger shop across my hotel. But also like Ron on the second question, I'm a firm believer that a lot of hurdles and friction that really separate the end consumer from what he or she wants in terms of the food, the meal, that's where the biggest innovation and change is going to come from.

I've seen it in the last 15 years, even in my one concept. But just seeing that evolution of, again, whatever those obstacles may be, I think technology and automation plays a big role in that. I don't get so caught up in the minutiae of, well, is it ghost kitchens, is it that? To me, at the end of the day, it's remove those barriers and make yourself more accessible.

And I think that will continue to be the trend. So first I want to give an unsolicited plug for Ron's book, Know What Matters. I read it just in the past few weeks, and it was like as soon as I was halfway through I ordered copies for all of my management team and my board because it's just such a so insightful and actionable.

In terms of where I think things are going, part of this is where I hope things are going, which is towards a more values-driven food system, meaning you have to give people the information to make choices they care about, and then make sure you can market and brand and build those to be meaningful. I remember a few years ago, the CEO of a large restaurant company said something, our job is just to sell people what they want. And I'd like to think that we as companies can do better. We can actually help guide people's choices towards what can create a better world. And that's where I think the opportunities are.

Thank you, Peter. Yeah, I mean, if you take that, I saw McDonald's. Did anyone see the quadruple Big Mac? They just, they brought it back by popular demand.

I was like. Who's going to eat four? Anyway, maybe we shouldn't give everyone what they think they want. I'm sure some of the students in here could do it.

But, look, I think from a macro perspective, I think one of the things you're seeing is a democratization of better choices in good food. I think good food is a right, not a privilege. And I think... The companies that are going to be on the right side of the trend and the truth are going to be able to develop a great product that tastes delicious, is high quality, and everyone can have it. So better food for more people.

There's a lot of better food, and it's on the coasts, and it's at specialty stores, and it's price tag. And there's a lot of bad food that you all can buy. And so how do you get better food as accessible as the bad food out there with cleaner labels and more natural? more nutrient dense.

And that's the future of food, democratizing better food and better options for people because it's a right, not a privilege, particularly in this country. And then look, things like, you know, high protein, low sugar, they're around to stay, you know, quality sources of protein. People are just constantly searching to eat high quality protein.

But I would just echo what these guys said. I'm not going to answer the environmental one because, you know, Impossible, Beyond are inherently environmental companies. We don't have departments and ESG departments. like the product we make is inherently about it. But look, I think, you know, in the end of the day, you still have to make delicious food.

You still have to make food that people want. But how do you make it exciting? How do you make it more available? How do you make it lower priced? How do you make it more accessible, I think, is the key to food making.

And look, food's dominated by three or four major companies, right, that made, you know. food for the troops in the 1940s and World War II, right, and loaded them with preservatives and things like that. There's just no need to have food like that anymore.

You don't need artificial flavors and colors and preservatives because we have a great supply chain, a cold supply chain now. That was critical to get to troops in the 40s. So I think food making is lazy. I think it's dominated by three or four major food companies that are yesterday's food companies. And I think they need to be challenged.

I really do. And then the last thing I'll say is I do believe it's plant forward. People are going to incorporate more plant-based options into their diet for many reasons. It may be for they like the taste. It may be that they have high cholesterol and they want no cholesterol, so better for you.

It may be because they don't like seeing animals slaughtered, or it may be because they want to reverse climate change and they see the environmental impact. where it may be that there's not enough animals to feed the world population, so it has to go that way anyway. So it's going to be all of those five or a few of those five, but the war, and look, we can debate what markets move faster and things like that, but what you can't debate is that the world be more plant-based moving forward. That's an undebatable thing.

Growth curves, geographies, what goes first, Europe versus US, we can debate that till the cows come home. But it's going in that direction and I think we're kind of on the right side of the trend and truth on that one. Well, I can't thank you all enough for coming and go Hoyas. Hoyas Axa.

Transcript for:Food Industry Leadership and Trends Panel

Transcript for:
Food Industry Leadership and Trends Panel