(Feature image courtesy of KPOP Foods)
Theo Lee is the CEO and founder of KPOP Foods, a business he started with friend and classmate, Mike Kim. KPOP is a Korean food brand inviting people to discover and enjoy Korean food and flavors through its products. Lee and Kim sell a variety of products online, including a Korean chili sauce and roasted seaweed snacks. They hope to offer their products in retail stores in the coming year.
Starting out
Why did you start the company?
I graduated from UCLA in 2011 and spent four years working in finance and banking. I wanted to become an entrepreneur and start a business, but I wanted to learn more about marketing and operations. I ended up back at UCLA Anderson School of Management where I met my co-founder. We’re both Korean Americans who were fortunate to grow up in families that tied Korean food with family and friends. We were always taking our classmates out to Koreatown to enjoy Korean barbecue. A lot of them had never had it before, and they really loved the flavors. That sparked the idea that there might be a big opportunity for us.
How did you fund the company at the start?
Mike and I were still in business school when we launched the company on Kickstarter last year. Up to Kickstarter, we self-funded everything. Thankfully, we raised about $40,000 on Kickstarter when our goal was just $10,000. That really got things moving for us. Shortly after closing that, we were able to raise another $150,000 from outside investors to help scale the company.
Related: 5 Ways That a Kickstarter Campaign Can Launch You Into Retail
Running the business
How do you manage cash flow?
From my experience in banking and finance, cash flow is something I track very closely. At the end of each month, I give all of our investors a monthly update of how we’re doing. That’s when I do a deep dive to look at how much cash we’re going through each month, how much of it is tied to product, how much we’ll need for the next two to three months, what our current cash position is, is there debt I can go out and get, and things of that nature.
What’s the most challenging thing about running the business?
The hardest thing is learning new parts of the business. When we first started out, we were very new to e-commerce and selling things online. We were able to lean a lot on our classmates and peers and advisors to help us out. The challenge that we’re now facing is distribution and working with larger distributors to get access to larger grocery stores. When we go into these meetings, we’re trying to really understand the numbers and the language and the strategy to make sure that we’re scaling at the right pace and that we’re following our plan to sell through once we’re in the stores.
What’s the most rewarding thing about running the business?
It’s always great to hear from customers and other people who have heard about us. When we started the business, we wanted to create a brand that people could relate to. Also, it’s rewarding to take a step back and see the team that we’ve built. It’s a great team of interns and part-time employees that are amazing. It’s great to work with them and to see them excited to come to work as well.
What I’ve learned
What’s the biggest mistake you made when you were starting out?
We did our first influencer campaign with an influencer called Ballistic BBQ. It was a huge hit. He ended up creating a recipe with our sauce called The KPOP Burger. It sold really well. It led to a positive return on investment. So, we thought we should go after other influencers. We did another campaign with another influencer, and the whole transaction seemed odd. We sent samples to him, but we really didn’t get any feedback. This campaign just didn’t convert. When we think about it, the influencer never really loved the product, which showed in the content. The video was great, but the recipes were sort of quick and easy, nothing too unique. Going forward, we really think a lot more about which influencers and partners make sense and which audiences make sense.
What’s the smartest thing you did when you were starting out?
Before we launched on Kickstarter, we were able to build a group of people that really loved our product. The way we did that was by handing out little samples at business school and to our friends, we also shipped them out. It helped us create a large community of people who were invested in us. We were constantly networking as much as we could, so we had a really strong following. We didn’t have enough money before Kickstarter to have a PR firm, so it was our community that really stepped up for us and shared the campaign.
What advice would you give to a new entrepreneur?
The scariest part about starting a new business is just actually starting it. Doing the small things like getting the website, getting the trademark, setting things up, making samples. The first time I was making samples of the sauce, I remember thinking, “What if someone hates it?” It’s a scary feeling, because you don’t know how people are going to react. But, once you start moving and taking the small steps to get going, things start rolling and things start to hit. After that, it’s really a fun journey.
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Future plans
What’s next for KPOP Foods?
This week, we just launched a new gift set called The Triple-threat Sauce Set that features our two newest sauces, KPOP Kimchi Mayo and KPOP XXX Sauce, which is a spicier version of the original KPOP Sauce. We also just closed an equity crowdfunding campaign and brought on our new head of product and product development, celebrity chef Chris Oh, who’s very well known here in L.A. for starting a number of Korean restaurants. In January, we’re launching another new sauce, KPOP Honey Glaze Sauce. Down the road, we’re really focused on distribution and growing our footprint in stores. We’re also focused on growing the brand. We have a lot of new content coming that I think is going to change the game for food videos.
This article originally appeared on Nav.com by Ashley Sweren.
