The Krave Jerky Success Story and Wicked Lekker Gets Coached [Radio]
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Have you ever wanted to sell your own kitchen concoction? Or have you been curious about how startups get their foods onto grocery store shelves? If so, this show’s going to have you salivating. Put your bibs on folks, and get your notepads out… this is a must-listen hour of StartupNation Radio, featuring Krave Jerky and Wicked Lekker.
We feature a Super Startup: Krave Jerky, straight from Sonoma wine country. Actually, make that Sonoma JERKY country. If you’re among the millions who’ve gobbled up Krave’s Black Cherry BBQ pork jerky, Basil Citrus turkey jerky, and a dozen other flavors, you already love the product. But this show will make you love the company’s founders and their success story, too.
Also on this show, we hear from a husband and wife startup team pioneering a brand new health-oriented chilled beverage branded as Wicked Lekker. We do a mash-up with one of the Krave founders and one of the Wicked Lekker founders to get some great coaching going and to make sure Wicked Lekker is on a path to success. Coach’s Corner is always our favorite, giving us and our expert guests a chance to spread around the love, share ideas and tips and help fellow entrepreneurs sidestep the many pitfalls they inevitably encounter.
Highlights and key takeaways from the Krave Jerky Super Startup portion of the show:
- We talk to Jens Hoj, one of the initial Krave team members, about the company’s incredible success story. Jens had worked in the restaurant business his entire life, with a stint in the kitchen of the famous chef/restaurateur Alice Waters, among others
- The Krave Jerky concept was to take a tired food category and, quite literally, spice it up. They took a more high-end approach to jerky, and also deliberately created a brand that appealed to women, which the jerky market had never targeted. Wholesome, healthier ingredients were also key to their positioning
- Funding totaled $1 million in debt initially, and then after they started ramping sales, they raised another $5 million in equity investment
- Krave had to be made: they decided to have third party food-making facilities produce their products
- Next came distribution, the build out of a business team to support a growing company, and optimization the business, which included recipes and products based on market feedback and trends, as well as optimization of operating margins
- From there, it was hustle and grow, hustle and grow, including expanding distribution to ensure category leadership and to position the company as an attractive acquisition target
- Revenue grew from $1 million in the first year to $5 million in the second year to $18 million in the third year to $36 million in the fourth year, the year leading up to the 2015 acquisition by Hershey’s
- Krave Jerky was sold to Hershey’s for $220 million, according to a Google search. That’s an incredible cash-out, especially relative to the amount of capital required to fund the business initially!
- Jens and his partner Jon Sebastiani then decided to parlay their experience and momentum in branding and selling food products into something even bigger, Sonoma Brands
- Sonoma Brands seeds and incubates outside and internally-generated food ventures that follow the Krave formula of disrupting tired food and beverage categories or creating new ones
- Two examples of products/ventures that are emerging from Sonoma Brands are a complete update to the marshmallow category—who woulda thunk—and also an innovative soup-related product line including nutritious artisanal gazpacho recipes
- So Jens and his partner are now leveraging their first Super Startup success story, with all of their newfound street cred in the food industry, plus their flush bank accounts and Rolodexes, and are looking for a repeat. They believe they’ve found a formula that has the makings of a mega company. We’re optimistic about Sonoma Brands
Then we added Mylan Janoplis to the show to get some coaching in Coach’s Corner for his beverage startup, Wicked Lekker.
Highlights and key takeaways for Wicked Lekker and other food and beverage startups offered by Jens Hoj, one of the founding team members of Krave Jerky, include:
- Create a disruptive brand: jerky was an entrenched $4 billion market before Krave came in and crashed the party. They totally shook up what jerky was, how it was made, who it appealed to and where it was sold. Truly disruptive
- Look for health benefits: if your product has a “better for you” angle, retail buyers will absolutely respond more positively because they are onboard with offering healthier products to their customers
- Sync your packaging with your product. It’s really important that your packaging really dovetail with the actual product within. Packaging should support, express and reinforce the brand attributes of your company and your product line. Think of Apple products and how their legendary packaging fits perfectly with their products.
- Avoid “me too.” Getting a product to market is tough. Fighting your way onto store shelves with an also-ran commodity product just makes things tougher
- Events are a must: Promotion of your food or beverage product can be extremely expensive, so consider concentrating your promotional effort at high-touch/high impact events. Krave was promoted at marathons and at yoga conferences where there were opportunities for the Krave team to create excitement in their target market.
- Go deeper vs. wider initially. In the early days of getting your product to market, and to create a compelling pitch to buyers from the bigger chains, it makes more sense to create a killer sales record—or as Jens refers to it—a “story” at one or two locations than it does to create a lot of mediocre sales at 50 stores. Demonstrate success in a microcosm and sophisticated buyers will understand how they can parlay that into their distribution on a much bigger scale.
It was truly a blast talking to entrepreneurs at different ends of the process, Wicked Lekker just starting up and Krave Jerky just being acquired by Hershey’s.
Jeff Sloan Rich Sloan