[00:00:10] Ray Latif: Hey everyone, I'm Ray Latif, and you're listening to the Top Podcast for the food and beverage industry, Taste Radio. This episode features an interview with Charles Coristine, the president and CEO of Better For You snack brand Lester Evil, who spoke about the company's remarkable turnaround from industry outcast to category leader. Just a reminder to our listeners, if you like what you hear on Taste Radio, please share the podcast with friends and colleagues. And of course, we would love it if you could review us on the Apple Podcasts app or your listening platform of choice. Best known for its organic popcorn and admired for its commitment to premium ingredients and innovation, Lesser Evil is one of the most respected brands in the snacking space. However, that wasn't always the case. Ten years ago, industry professionals regarded Lester Evil as quote, a dog with fleas, according to Charles Coristine, who acquired the troubled company in November of 2011. A former bond trader with no experience in the food business, Charles admits that at the time, he wasn't fully aware of the severity of the brand's problems. Getting Lester Evil back on track required him to rethink nearly every aspect of the company, from ingredients and manufacturing to retail strategy and product development. Rebuilt as a vertically integrated company that emphasizes gross margin and innovation, Lester Evil eventually found its footing and today sells millions of its eco-friendly bags of organic popcorn and puff snacks annually. The brand markets seven product lines, with two more set to launch this year, and has carried it thousands of retail stores across the U.S., including those of Target, Wegmans, CVS, Costco, Walmart and Whole Foods. In the following interview, I spoke with Charles about how he evaluated the potential for lesser evil, assessed the brand's problems, and why building a manufacturing facility was key to the turnaround strategy. He also explained how to enhance relationships with retail buyers, why personal evolution is highly motivating, and why he's a proponent of failing fast. Hey folks, it's Ray with Taste Radio. Right now I'm on a call with Charles Coristine, who's the president and CEO of Lesser Evil. Charles, how are you? I'm doing really well. Thanks so much for having me on your show. I'm super excited to be here. Well, thanks so much for joining us today. I'm super excited to speak with you. You know, I mentioned that you're the president and CEO of Lesser Evil. But some people might call you the founder of the company. And this is the thing that we talk about often at BevNET and Nosh is if a person came to a company after it was started, they're not technically the creator of the brand, yet they're responsible for the brand success. Shouldn't they be called a founder or co-founder at least or something to that effect?
[00:03:02] Charles Coristine: You know, I've been struggling with this one for a while. I think now, as I've put my mark on it, and as it's a completely different company, I'd probably be more comfortable calling myself the founder, but I think it was certainly an evolution that took probably four or five years before I got there.
[00:03:18] Ray Latif: It is a little bit of an odd history for the company. Give us a little bit of background into how it started and how you came to Lesser Evil.
[00:03:27] Charles Coristine: So Gene Hackman's wife, Betsy Hackman, was kind of a little bit ahead of her time. She was a big proponent of the Atkins diet. And now we look at keto and a lot of what was good in Atkins is now in keto. But she was messing around with maltitol, which was the sugar alcohol, back kind of in the mid 2000s. And she was trying to put basically this lower sugar, lower carb popcorn that was healthy. She was apparently a popcorn addict. Unfortunately, at that time, maltitol just was a really tough ingredient to play with. You know, you remember those whole lean potato chips, they kind of... Oh my goodness.
[00:04:07] Ray Latif: There's a word that was associated with that brand and the word was explosive. Not in a good way.
[00:04:14] Charles Coristine: Exactly. So I think she struggled with a little bit of that. You know, the value proposition was also probably not all that great. She had these little popcorn, you know, almost like a movie theater, like another shape, the boxes are shaped like this. You know, it was a great marketing concept. But unfortunately, if you tried to stack it, it would fall over. If you touched, you know, you took the bottom one. Anyway, so in store, it turned into quite a fiasco, you know, in terms of the people always constantly having to restock the shelves because, you know, some customer would pull out a thing and the whole display would fall down. So they tried that for a few years. Then they tried a line of crinkle sticks, which were just basically a potato puff shaped in a French fry. But that was just kind of, you know, it was basically a potato chip. It was a great shape, but it just wasn't enough to move the needle. So they kind of didn't really know where to go next. And they had blown through a ton of money. They created a really cool concept, a really great name. There was a lot of great marketing assets behind it, but I think that it was turning out to be a lot more work than they expected and a lot more expensive. It needed to change, Les Weaver needed to evolve. And I think that that's basically what happened when I got involved.
[00:05:25] Ray Latif: Yeah, it's interesting. We often see celebrities get involved in brands these days and then call themselves co-founders. No offense to celebrities, it is what it is. Versus celebrity starting brands and hiring people to run it for them. I think in this case, it was the latter and it didn't work out so well. Now, your background was not in food and beverage. Your background was in bonds.
[00:05:51] Charles Coristine: From bonds to beans.
[00:05:53] Ray Latif: Yeah, not a lot of connect. As far as I know, not a lot of connections between the bond market and the food and beverage industry. I could be wrong, but what motivated you to get into our industry?
[00:06:03] Charles Coristine: I've talked about this in the past a little bit, you know, being on Wall Street for a long period of time, and it was, you know, close to 17 years. It's tough, you know, the combination of living in New York City, the lifestyle, you know, entertaining a lot of customers that then later commuting from Westchester into the city. I think when I got close to 40, I was feeling that I was, you know, kind of a little jazzed up in terms of, I was kind of at my wits end. So I was like, I've got to try something else, you know? So I had gone back and done, gone to business school part-time purely with the purpose of figuring out what I could do if I had to live another life. And then This came along and it was, it was, there was some synchronicity here. As I was suffering from more stress, you know, I was making some lifestyle changes. I had started meditating. I had gone vegetarian. I certainly was really into food as a, as a form of medicine. And then this comes along, I'm like food, this is kind of, this could be interesting, you know, and it was for sale. It was from a friend and friend's father. And so I, you know, I just, it was impulsive. I know. And I had no idea what I was doing, but I just said, I'm going to try this. And it opened up a whole can of worms that I wasn't prepared for. But, you know, looking back 10 years later or nine years later, I mean, it was one of the best decisions I ever made. Some of the things that I learned, you know, being a bond trader on wall street that actually helped a lot in the food industry was In order to be a good trader, you have to learn to cut your trade. You're losing trades really quickly. It's a real battle with oneself there because you get highly emotional about these things. But once you can get through that and see what's working, what's not working, and not look at things emotionally, you can pivot and move really quickly. And I think the only reason why I survived at Les Rebo for as long as I did at the beginning, because obviously, we can get into all the problems we were going through, was that I caught a lot of the stuff that wasn't working at the beginning. And then in the first four or five years, we launched a lot of products. that just didn't fit or didn't work for whatever reason. There were some skill sets that I learned on Wall Street that actually did pay off in the food and beverage world.
[00:08:24] Ray Latif: Thick skin, for sure, it seems. Yeah. Yeah. Let's talk about those problems because when you bought the company, it seems to be a ship going in the wrong direction and then the wrong direction being underwater instead of in any kind of direction. What was wrong? What did you find out that was wrong with the company that you needed to fix pretty quickly?
[00:08:43] Charles Coristine: Well, the product velocity in store was terrible. So we were getting discontinued everywhere. We had gone down channel as a company, you know, so you, you know, we were doing business with a lot of smaller retailers that were just looking for deal on price. And then on top of it, our whole margin structure was, was upside down. So even the business we were doing, we were losing money on. So, I didn't realize how bad it was going to be, but we realized really quickly we're going to have to do something. Otherwise, we could be in business much longer.
[00:09:16] Ray Latif: Let's talk about margins because I think one of the things that you realized almost immediately was that your margins were terrible. And this is something that entrepreneurs struggle with all the time because you're advised to have a healthy gross margin, 40% or higher if possible. It's very, very difficult to make it otherwise. What did you do? What were some of the steps you took to improve your margin?
[00:09:38] Charles Coristine: That is a great question. And I think entrepreneurs really need to listen to that. You know, a lot of entrepreneurs get into something and say, OK, the margins suck up, but I've got a great product and somehow I'm going to figure it out. But they just never figure it out. They never give themselves a chance. You know, when you think of managerial accounting. you need to structure products or make products that have a healthy margin profile. Otherwise, you're never going to get out of the gates. When I think of developing a product, I go into it knowing exactly where I need to manufacture for because I know where I need to sell to a distributor. If I don't have 50-point margins in it or close to 50-point margins or at least a road to 50-point margins, I'm probably not going to launch that product.
[00:10:27] Ray Latif: And getting to that 50-point margin, I think when we spoke last, you had mentioned the company and the brand was doing 30-point margins. Yeah. That's a big leap to get to. I mean, how do you get better from one point to the next? I mean, I'm assuming it's pretty difficult to go from 30 to 35 and then 35 to 40. I mean, going from 30 to 50 sounds like it's near impossible.
[00:10:49] Charles Coristine: Yeah. You know, and especially the small size, it's really hard to use economies of scale to get there. So for us, it was making a leap of faith and jumping into manufacturing and starting to manufacture all our products. make a big investment in equipment and real estate and other stuff, obviously personnel to run all that equipment stuff. So it's a big leap of faith for a lot of entrepreneurs. And a lot of entrepreneurs, if they're not willing to do that, they have to look for a product that has probably broad margins that are bigger, because you're going to have to pay a copacker probably 20% margins. And then you've got trade spend that you're going to have to give the stores of 20. So if you've got 50, and let's say you do have the 50, and you've got to give 20 to a copacker and 20 to trade spend, you're only left with 10. And that's hard to keep the lights on in that kind of environment. You really need to net out around 30 points.
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[00:12:32] Ray Latif: It's a leap of faith, but it's also a bet on yourself, right? I mean, this is essentially long-term debt. I don't know if you had the money really to just launch a manufacturing facility at the outset, but to keep the lights on, to keep it running, I'm assuming you were in the red for some time.
[00:12:47] Charles Coristine: you had to, we got into bed with the bank and, you know, there were some personal guarantees that were placed on some of the initial equipment. So it is kind of scary because I didn't have all that capital to buy all that equipment. So it certainly is a huge leap of faith, which a lot of people aren't comfortable taking because, you know, it's one thing going bankrupt. It's another thing losing some of the assets, you know, that potentially your family depends on, if that makes any sense.
[00:13:14] Ray Latif: Yeah. And it was tough, I think, at the time, too, because Lesser Evil had this had this reputation of being a brand that didn't turn on shelf. I mean, nowadays you see it on shelf and it's like, wow, yeah, Lesser Evil is great. You know, this is flying off the shelf. But. eight, nine years ago, this was, as I think in your words, you know, a dog with fleas. How did you start to rebuild that reputation?
[00:13:37] Charles Coristine: That's a really good question. I mean, I think for the first three years I was walking around with hat in hand and I think people were like, no, we don't want to see you. My wife is like, she makes fun of me. She was like, you're staying in all these cheap hotels, you know, trying to get people to talk to you. And it was tough, right? Because we had a spot he passed. And obviously, I bought the company on the cheaper reason, you know, because it was going to be very hard to turn around. I think there were a couple people that they gave me a shot early on because I think they felt sorry for me. One of those retailers was, was Wegmans, you know, and I'm forever grateful for that. You know, one particular buyer, I think really took pity on me. His name was Joe Pucci. He's kind of an old school guy. And then I think we basically got the plant up and running. I was really into, you know, kind of trying new things. And when we started innovating and started coming up with some different concepts and I could go and say, I've got something really new and unique. I think we started to get some interest in talking to us, but it was a long road those few years.
[00:14:44] Ray Latif: Yeah. It's funny you mentioned Wegmans because I'm pretty sure that's the first time I saw your brand in stores. And the first thing that caught my eye was your flagship product, which was the Himalayan salt popcorn and a remarkable product.
[00:14:58] Charles Coristine: We didn't launch that until, I think, 2014. Wegmans took a shot at us in 2012 with a chia crisps, which was this black bean, it was basically a black bean pop chip with chia in it. It was not a bad item, it was pretty good, but it was definitely out there. That same item, we got discontinued at a household in six months. But Wegmans has an amazing consumer and their consumers got it, which was really cool. So that was really what got us out of the gates.
[00:15:28] Ray Latif: Yeah, and it was a scale driver for your brand. It was, I mean, it was the way to get that kind of velocity that you hadn't been getting with your other products. How did you start to understand what the consumer wanted, what retail buyers wanted to see out of the brand to fill that innovation pipeline and get Leicester Evil known for not just healthy products, but great tasting products as well?
[00:15:52] Charles Coristine: Wow. So you're bringing me back. So we went to, I'm thinking about the genesis of our popcorn, you know, the Himalayan pink popcorn made with organic and some virgin coconut oil. I started doing some of these nutritional retreats and I went to a place called Kripalu, which is like a a yoga meditation center here in the Northeast. And this guy, John Bagnullo, was talking about all the benefits of coconut oil. And I was laughing. I was like, you know what? I own a popcorn manufacturing center. We had gone from Chia Crisp to Chia Pop, which is an organic popcorn. And I'd seen the fire of the popcorn. The turns in the crisp were probably like six, seven units per store per week. But popcorn was a whole different dynamic. We were seeing 10, 12, 13 turns per store per week. And he was like, you should really try putting extra virgin coconut oil on this popcorn. And you should also use Himalayan salt. So as much as I like to think it was my idea, but it was really this guy's idea. So I came back. I was all jazzed up. And I told my partner Andrew, we're going to try some of this extra virgin coconut oil on popcorn. And sure enough, it tasted great. you know, the Himalayan salt thing was, we were early on that. No one was using Himalayan salt on, on anything at that point. We're talking 2014. Now it's, you see it everywhere, but, uh, that was it. And, you know, once that started to catch fire, it kind of gave me some momentum. And as the momentum built, I got some self-confidence and I started thinking, okay, well, why can't I do that with avocado oil? Why can't I do that with organic grass fed ghee? Why, you know, like I started thinking of all the different oils and good fats that I can use on, on different products.
[00:17:32] Ray Latif: And did consumers understand that stuff? I mean, back in 2014, were they understanding coconut oil and Himalayan salts and just the notion of a better-for-you popcorn?
[00:17:43] Charles Coristine: It was a tough road. I mean, people thought that Skinny Pop was a healthy popcorn, right? And Skinny Pop was on fire in those days. So we kind of struggled in the mainstream with the product because people didn't really understand coconut oil at that time. But where we really started to get some traction and see some really big velocity was in a lot of local, small, independent health food stores. And that's not enough to drive your business long term, but it was enough. We got a lot of independent distribution with NCG and Infra and all these little guys. And then we saw a lot of the California chains, like the moms and the Jimbo's. They understood it. And then eventually, Whole Foods is obviously a company that's very near and dear to my heart, but it took a while because we'd had a spotted history with them where we had launched the popcorn and hadn't, you know, in the initial concept, it hadn't done so well. But now we had some like, hey, this is doing really well. And that allowed us to make the inroads into some of the regions. And then once we got into the Whole Foods regions, then we started picking up two, three, four every single year. And that was really what we started to catch fire.
[00:18:53] Ray Latif: The relationship between an entrepreneur or a founder or a president, CEO, and a retail buyer is a very, very important relationship, especially at the outset. You are not just the brand owner, you're the representative of the brand. How do you make relationships work? How do you make relationships with retail buyers work? I ask this a lot of entrepreneurs, but I think in your case, you have a pretty good, pretty interesting answer on this.
[00:19:21] Charles Coristine: Yeah, I think you want to make them look as good as possible, you know, and you want to be as honest as possible because you only have one chance to make a good, good first impression, you know, because you give them something bad the first time, chances are you're going to blow that relationship up right away. I prescribed to the theory of a lot of people want to get into all these major retailers right from the get go. I prescribed it like you've got to wait until you've got your story and you can take a really smart crack at some of these guys because you're not going to get a chance. And then once you give them something good the first time, then you can start to take a little bit more risk, as long as you're honest about it, you know what I mean? Because they'll start to believe in you. My whole thing with retailers is to be super self-effacing. When something's not working for us, like, hey, this isn't working, we've got to change it. I realize I'm not making you look good, and I'm taking responsibility for it. I'm going to take responsibility for our relationship. I'm going to make sure that everything you have on shelf is starting. And if it's not, I'm going to replace it. super active with them and make sure that they feel like you're giving them the best possible products. And also you're innovating with them, you know, first or showing them first, especially in the sector in which I play, where those guys really care, you know, the bigger grocery chains, they want something that's vetted. But where I operated kind of in the natural world, I only had seven or 10 relationships and I wanted to make sure that I was giving them the best innovation as fast as I could.
[00:20:53] Ray Latif: and being personally involved in these relationships?
[00:20:56] Charles Coristine: And I would call them and bring samples to them and we would have to do taste testings. And they would tell me, no, I don't like that flavor. Could you try this flavor? Or I don't like that ingredient. Can you change that ingredient? So sometimes I would go down there with mock-up packaging. And we would come out of a meeting and what I thought were going to be two or three skews that were going to be on runs that changed. But I was okay with that. You know what I mean? Because I realized that these guys were the ones that were really taking the risk on me and I wanted to give them exactly what they wanted.
[00:21:26] Ray Latif: So it sounds like they were pretty influential in your innovation pipeline.
[00:21:30] Charles Coristine: Absolutely. Absolutely. Especially in ingredients. We wanted to make sure that we're using ingredients that they can really get behind. And the really hardcore ones were really big into the ingredients. Like, hey, we're not using this. We're not using that. We are using this, you know, and you get sponsorship.
[00:21:48] Ray Latif: Did it help that you had an alignment in terms of your personal lifestyles or beliefs? I mean, I guess what I'm getting at is you have to be friends with retail buyers. Can you be friends with them?
[00:22:01] Charles Coristine: I think so. I'm still friends with a few of my retail buyers. Yeah, and it helps. For instance, I do CrossFit. There were a couple of buyers that I've become friends with that did similar stuff, and we can talk about other things. But I also live the Paleo lifestyle. I had been vegan. I knew what autoimmune protocol was. Everyone's got different customers and different needs, and I can talk what they needed. because I own my own manufacturing, I could then design products around what their consumers, what they thought that their consumers needed.
[00:22:35] Ray Latif: Well, consumers want plenty of your popcorn. And it is it represents about half of the 60% of our business.
[00:22:45] Charles Coristine: Wow.
[00:22:46] Ray Latif: Okay. Yeah. And you guys carry a lot of different products that how many product lines do you have at this point? God, I'd say six different product lines, maybe seven. So someone who wants to needle you, and that's not me, I'm just saying, someone wants to needle you might say, well, why do you have six product lines? Why are you investing your time and resources in all these other products when 60% of your business is popcorn?
[00:23:13] Charles Coristine: Because we're looking for the next home run. It's a treasure hunt. It's basically what we embrace. We've got two new product lines starting now and they both could be flops. I have no idea, but we're going to find out. But that's what's exciting. We're going to send out samples. One's launching in one chain, one's launching in another chain. And we're going to see if this resonates with consumers. And if it doesn't, it's back to the drawing board and I'll try again.
[00:23:38] Ray Latif: Do your investors ever get mad at you for coming out with all these new product lines? My plant manager gets mad at me for coming out.
[00:23:47] Charles Coristine: because he's got to do a lot of, you know, when we think about efficiency and margin, we obviously want to run the equipment for as long as possible, you know, multiple shifts, the same thing. But when I've got so many different products, you know, he's got to break down equipment, clean things before, you know, and he's running half shifts when he's, so he gets frustrated with me all the time. He's like, you can't be serious. You want me to run this, this and this today? I'm like, yeah, I'm sorry. But he's gotten used to me.
[00:24:17] Ray Latif: Well, yeah, I mean, the manufacturing side of things I'm sure is pretty complex and challenging, but if you do have a great plant manager, it's certainly helpful. But, you know, on the financial side of things, you know, someone's putting money into your company, into your business, and they're saying, well, I think, you know, I'm going to get a better return on my investment if you focus on this particular product line and not this one. That might be a tough conversation to have if your passion is innovation and their passion is profit.
[00:24:43] Charles Coristine: Yep. Right. I mean, I haven't had to deal with that, because on the other hand, I'm pretty frugal and we run at a profit. So I don't dig too deep and I obviously cut my losses pretty quick. But yeah, at some point, if someone was to buy us out, they'd probably change things and they probably could become much more efficient than I run things. But I mean, how do I phrase this? I do see light in what we're doing, though. I think it delights our customers, first and foremost. I think people look forward to seeing what we're doing. I think it keeps us extremely relevant with our partners. Our partners, they're not saying, oh my God, here he comes with other stuff. I think they're excited to see what we come up with. And fortunately, I don't think I've flubbed too bad. I haven't come out with products that don't turn at all. Some of them turn better than others, and I'm pretty quick to discontinue and add something different if it's not working, which is what I was talking about before.
[00:25:47] Ray Latif: Yeah, you're not afraid to fail is what you're saying. And I think that the term you used when we last spoke was fail fast, fall forward.
[00:25:55] Charles Coristine: Exactly. So, you know, I'm always constantly trying to, I have my little notebook and I'm trying to constantly evolve. Like, so if that product didn't work, maybe there's something that we can add to it that, you know, so if you want to quickly talk about our product evolution, like, you know, from popcorn basically came PaleoPuffs. So what I learned from popcorn, I applied to PaleoPuffs and I, applied into basically a grain-free item. So I applied the good fats, the salts, the no processing. It's basically air popped. We use a twin screw extruder, but it basically just uses pressure. Then we applied a protein component to that. So I was trying to add protein to it, egg white protein, which was super clean. Since then, we've done a toddler snack that is built on that. And then now we want to get into plant protein instead of egg white protein because we think that's the future. So now we're into upcycled watermelon seeds. So you can see that everything kind of builds slowly on what we've learned and some of the items we leave behind as we continue to move and other items just stick around, if that makes any sense.
[00:27:01] Ray Latif: Yeah, absolutely. And these products sound on trend. Some trends are more lasting than others. I think, you know, chia as an ingredient was a pretty trendy ingredient six, seven, eight years ago. Seems like not as much today. So how do you know, or are you trying to get ahead of a trend or are you trying to be on trend?
[00:27:24] Charles Coristine: Yeah, we don't want to be too sticky on any ingredients. You brought up a great point about chia because we felt at one point when we had the chia crisps and the chia pop, we were too chia focused and then we needed to pivot fast because chia looked like it could... It's still around. It's still an incredible thing. I still put chia seeds in my smoothies. It's not an ingredient that's going away. It's not a customer buzzword anymore. So we don't do that anymore. We don't call anything by a sub-ingredient because we realize that there's some temperance there. So all the stuff we do now, we feel like is a little bit more lasting. I don't think organic pea protein is going anywhere. It's super easily digestible. You can put it in anything. It's super versatile. It's super clean. I think upcycled seed protein, like I'm talking about pumpkin and watermelon seed, I think that's the future. I mean, I think those things are real. I think plant protein is the future of protein, especially with what's going on with the environment. So I think these are longer term trends.
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[00:29:18] Ray Latif: It certainly seems like you're on the right track, and if your track record is any indication, you've been making the right bets. As your product line has evolved, so has the meaning, I think, of lesser evil. It's changed a bit over the years. How has it changed?
[00:29:36] Charles Coristine: So I think when lesser evil first came about, it was about making evil things less evil. You know, like we could take a, you know, a popcorn and make potentially a popcorn that wasn't as good for you, better for you. You know what I mean? But I think consumers, you know, better for you is not necessarily where we're trying to go. I don't think consumers are completely done with better for you. I think you're going to see people that want the indulgence, but want slightly less fat or something. So you're still going to see that. But that's not I don't know if that's really our consumer. We're trying to make things good for you. We're obviously not perfect. But now the term lesser evil is certainly evolved for me. We know that the world is not perfect, but there's beauty in the fact that it isn't perfect and that it is through the darkness that you find the light. you know, the name now is for us is, is we're going to kind of constantly evolve and we're going to constantly try to get better and we're not going to be perfect, but we don't believe in settling. And that's what the name means to me now.
[00:30:42] Ray Latif: I'd like to talk about your personal evolution in this business as well. I think you seem to be comfortable sort of being under the radar and that's not a bad thing at all. And I feel like in a lot of ways, the brands and the entrepreneurs that are sort of below the surface, but doing really, really well are the ones that don't need to be on the cover of magazines or don't need to have that feature article. They're just doing their thing. And, you know, it seems like you as a leader are less of the glitzy, glamorous, you know, marketing type, who's the arms folded and, you know, on the front page of LinkedIn and all that stuff. Yeah, there's some guys who use LinkedIn pretty well. How is your leadership style different from others and how has it benefited you personally and the company as a whole?
[00:31:32] Charles Coristine: So I believe that Lesser Evil is allowing me to, I mean, it sounds a little cliche to work in your dorm or whatever, but to basically use the company as a vehicle to work on yourself. So you come to work every day and I think of the things that I really like working on. I love connection with people. So I love team building. I love the fact that we're going through this journey or this voyage together and that we're all trying to help each other. I like organization, I like discipline, I like, you know, so all these things that I want to see more in myself, I try to bring them to Lesser Evil on a regular basis to help improve my life. It's really a personal journey and Lesser Evil has been a vehicle to basically to create an internal landscape that creates an external reality. I know I don't want to be too, to get too deep into it but I'm so thankful that I've gotten to go through this journey kind of alone and uninterrupted in some ways because we're not in San Diego or we're not in Boulder, Colorado where There is more of a thriving community, but potentially a little more pressure, right? I mean, here we can kind of, we come to work, we've got our little factory, we've got a little warehouse, and we have team meetings, and we're kind of isolated, and it just allowed us to really keep our eye on the ball and not get too big in that external world where we're you know, where it's really easy to get caught up in your own success. Here, it's much more, and I don't want to say isolated, but it's comfortable, you know, and it's quiet. And for me, it fits really nicely.
[00:33:13] Ray Latif: I think one of the things that's pretty interesting about Lesser Evil as a brand is that I never got the sense, and even more so I don't get the sense after talking with you, that Lesser Evil was one of those brands that was, you know, built to sell. And I could be wrong. I mean, most brands are, you know, putting themselves into a position where if there was an opportunity, hey, great. But it feels like Lesser Evil is sort of built for the long term.
[00:33:35] Charles Coristine: Never had a chance to build it that way. Yeah. Yeah, because, Ray, you're asking amazing questions. Because of where we came from, we had to be so scrappy. There were no investors lining up at our doors for a long, long time. We're talking six or seven years of internal funding and making every single dollar stretch as far as we could. I mean, we were buying equipment out of the junk scrap, literally. And my partner, Andrew, who's a really smart guy, he was an engineer, you know, we would try to bring this stuff back to life and see if we can use it. And it allowed us to grow smartly and not throw a shit ton of money at, sorry if I'm not allowed to swear, at marketing. And a lot of entrepreneurs want to grow so fast because they, you know, hey, we've got to grow at 50 to 75% a year because our private equity firm that's behind us wants us to grow that fast. And the strategic that's behind the private equity firm needs it to, you know, like, so they follow this formula. And often you can see that, you know, it leaves behind not necessarily the best business practices and certainly not a lot of profitability, right? Because all of a sudden your trade spend may creep into the 25 to 30 point range. You're spending a ton of money on marketing, you know, and you don't even understand if it's really moving the needle. Whereas we didn't do any of that stuff. Our marketing budget for probably five years was less than 1%. We had to let our product quality, you know, even on our branding, we didn't have great branding for a while. I mean, our branding, you know, I had lesser, you know, I had bootable, I had everything written on the package because, you know, me and this guy Serge were creating packaging in a dimly lit room in Denver. It allowed us to create a pretty healthy business, but grow at a more moderate rate. I would say our growth rate has actually picked up in the last couple of years, which is exciting. We found the sweet spot for us, and I hope other entrepreneurs listen to this, is 50% to 60%, maybe too much for a small business to grow five, six years in a row without A, losing a lot of equity in the business. but also putting a lot of strain on the business. So we found that, you know, we could grow nicely in that 30 to 40% range and that we can do that fairly inexpensively.
[00:35:57] Ray Latif: When is the right time to invest in marketing? I mean, investing less than 1% of your business in marketing. I mean, that's not a lot at all. When do you see the right time to broaden awareness of Lester Evil as it relates to, you know, mainstream consumers? Because I think there's a real opportunity. It's that, you know, now it seems like, especially when everything that you're doing is aligned with seemingly what everybody wants.
[00:36:27] Charles Coristine: We've changed that. Obviously, in the last few years, we probably went from 1% to 3% to 5%. And I think this year, our marketing budget will probably be in that 6% to 7% range. And we may start to do that, because we're finding that as our brand awareness increases, we're seeing fairly large sales increases. But we're in a good place, because we're actually making money. So we can take some of the money that we're making and allocate it to marketing. So it's really different for every entrepreneur based on their cashflow really, but you want to be sure that, you know, you're seeing some positive ROI and, you know, I don't want to get too into it, but, you know, there's a whole way, different ways to measure return on investment in terms of marketing, you know, in terms of lift and velocity and all that stuff that we can get into, but it is somewhat technical.
[00:37:19] Ray Latif: Well, I think some of our listeners might be interested to hear a little bit about that. I mean, how do you measure return on investment in marketing? It's tough. I know it's really, really tough. And I think, you know, what are some of the metrics that you guys use?
[00:37:30] Charles Coristine: When I think of marketing, I mean, you can do some of this general awareness kind of marketing on Instagram, right? Or on Facebook or whatever, that stuff is super hard to measure. But recently in the last probably three months, we've brought an agency in and we've spent about, I don't want to say we've spent probably $20,000 on two campaigns and we've you know, just with the creative side of it. And then we probably spend $25,000 to $30,000 a month on just, you know, on implementing that campaign. And we've seen velocity increases above and beyond our typical growth rate of, I'd say, 10 to 15%. So I'm kind of, it's a little bit of a finger up in the air kind of thing, but something's happening and I can feel it. And I'm seeing some of it flow through to the bottom line. So I'm taking more of that money and I'm investing more of it. I'm going to invest more of it back into these general campaigns. Like we did a summer campaign. We're just about to do a back to school campaign. And now we're going to do a bigger, broader, more general marketing campaign around what makes Lesser Evil different than its competitors. Then there's the whole way you can look at things when you're actually trying to sell a particular product. We were trying to drive customers to our website in a lot of our previous campaigns because I wanted them to pay for themselves, essentially, because I figured if I could drive enough, to our website or to Amazon, that my profit margins would end up paying for it. But our product margins are so thin on direct-to-consumer, both through Amazon and through our website, that it was questionable whether I was actually making any money on that at all.
[00:39:12] Ray Latif: That's very interesting, because I think everyone assumes that e-comm is a great way to drive and generate revenue.
[00:39:19] Charles Coristine: Part of our problem is that our products are, popcorn just cubes out, snacks just cube out terribly. So a five pound package cube out at 20 pounds and it can cost you $20 to ship that West Coast and the value of the product in the boxes is close to that. Like we're selling to our consumers that whole box at $30, right? So if $20 shipping, it's tough to make, especially consumers now want to have you know, they're in two days and they don't want to pay for shipping or they want to pay very little for shipping. So we're still committed to it. We noticed that most of our competitors aren't shipping from their own website, like popular brands aren't doing that anymore. But we want our consumers to get a lot of our different product SKUs to try because they may not necessarily get them at local retailers. So we still view it as a very important part of our business, even though it's not all that profitable.
[00:40:17] Ray Latif: Charles, it's been so amazing speaking with you. It's such an honor. I'm a big fan of your brand, and I think that it's so great to see it in your hands, running it, you know, back in the Gene Hackman days. It's funny, and coming full circle, we might not be speaking right now about Lesser Evil at all had you not taken the reins. So I think it's time to put that founder stamp on your business card.
[00:40:43] Charles Coristine: Order some new business cards for Expo East. Are you going to be at Expo East?
[00:40:47] Ray Latif: Yes, yes, we'll be at Expo for sure.
[00:40:49] Charles Coristine: I look forward to meeting you in person.
[00:40:51] Ray Latif: I'm excited. I'm looking forward to seeing those business cards. But once again, Charles, thank you so much again for taking the time to speak with me. This has been an amazing conversation.
[00:41:01] Charles Coristine: Thank you very, very much for having me.
[00:41:05] Ray Latif: That brings us to the end of this episode of Taste Radio. Thank you so much for listening, and thanks to our guest, Charles Coristine. As always, for questions, comments, ideas for future podcasts, please send us an email to ask at Taste Radio. On behalf of the entire Taste Radio team, thank you for listening, and we'll talk to you next time.
