[00:00:10] Ray Latif: Hello, friends. I'm Ray Latif, and you're listening to the number one podcast for anyone building a business in food or beverage, Taste Radio. This episode features an interview with Poorvia Patodia, the founder and CEO of pioneering chickpea snack brand, Vienna. Vienna was at a crossroads. Five years ago, its popular roasted chickpeas were widely distributed at natural and conventional grocery stores, including Walmart, Whole Foods and Target, and the brand was making significant headway in travel retail stores. That year, Vienna also completed an $8 million Series B funding round and launched an innovative line of chickpea puffs that helped establish itself as a snacking platform. The pandemic, however, forced the company to adjust its growth strategy. Vienna was faced with declining margins and retail channels that were once promising but now unprofitable. Founder Poorvia Patodia had to make, in her words, quote, risky decisions. Vienna may have changed course, but its adherence to a foundation built on financial fundamentals and a focus on mainstream consumers helped the brand remain on a path of sustainable and long-term growth. In the following conversation, I spoke with Porby about how Bienna navigated the challenging period and how a build-to-win methodology advised every key decision during the process. She also defines and explains the value of true differentiation, why the company is pursuing a dual-platform strategy, and shares her take on when founders should raise capital and how to identify distributors with aligned values. Hey folks, it's Ray with Taste Radio. Right now, I'm honored to be sitting down with Poorvia Patodia, who is the founder and CEO of Vienna. Porvi, great to see you.
[00:02:04] Poorvia Patodia: Great to see you. Thanks for having me.
[00:02:06] Ray Latif: Yeah. Thanks for coming back to our office.
[00:02:08] Poorvia Patodia: Yeah.
[00:02:09] Ray Latif: You're here at least once a year.
[00:02:10] Poorvia Patodia: Right, right.
[00:02:11] Ray Latif: Yeah. We hold events for... Well, the community to come in and see us. And then we also hold events in conjunction with Naturally New England. You were a judge for the most recent New England Pitch Slam, which was awesome.
[00:02:24] Poorvia Patodia: That was a great event. Yeah, it was.
[00:02:26] Ray Latif: And thank you so much again for being a judge. I felt like when I was watching that, you were the the alpha judge, if you don't mind me saying. Because you've been doing this for 12 years, you know what's going on.
[00:02:39] Poorvia Patodia: Yeah, I'm a brand owner, right? So I think I was the brand representative, right? And so of course, you know, just the role itself.
[00:02:46] Ray Latif: Well, it's interesting and I don't mean to throw shade at anybody else, but if you haven't built a business, if you're not an entrepreneur, It's really hard, I think, for you to give the best advice you can kind of give. I think there's some really good advice you can share. I think there's advice that you can share based on others' experience and just an evaluation of what makes a great brand and what makes a business successful. But unless you've had those sleepless nights and, you know, questioned everything, like, and Barbie's nodding her head like, yes, daily, daily. It's really hard, I think, to put yourself in that position of being able to share advice and give good insights.
[00:03:27] Poorvia Patodia: I can see that, you know, increasingly I've been mentoring founders or, you know, having different conversations with different emerging brand founders who are, you know, navigating different challenges or thinking through questions. And you're right in the sense that, you know, there's a lot of experience that I can call upon. And I've also, I think, had the benefit of having led a brand for a decade now, right? And so I've actually seen the impact of decisions that I've made or strategies that my team has taken. And I know like what's worked well, what's not worked well. And so just having that experience, I think people find to be helpful.
[00:04:05] Ray Latif: For sure. Yeah. One of the greatest things that an entrepreneur can see is their product organically incorporated into a TV show. This happened recently with Vienna, where there is a TV show called Nobody Wants This, featuring the famous actress, Kristen Bell-led I guess when she was working out or while she was working out, she was snacking on your veggie chips. Is this what I'm seeing? I'm watching it on Instagram. I can't tell if she's working out or not. She's doing this kind of weird dance.
[00:04:34] Poorvia Patodia: Yeah, I think she's... She is pacing, more or less pacing, deciding if she wants to like open this box full of secrets that her boyfriend has in a cabinet or something. So yeah. Yeah. So that's, I think that's what the scene is. Yeah.
[00:04:50] Ray Latif: While snacking on your chips.
[00:04:52] Poorvia Patodia: Yeah, while she was snacking on our veggie chips and that was a huge surprise. So, you know, I started getting texts. I guess it's in episode eight. So it's like how many people, as soon as the show was released, got to episode eight that quickly, you know? And so, yeah, I suddenly started getting, you know, texts and DMs and my team as well. So that was, that was really fun.
[00:05:13] Ray Latif: Yeah. Yeah. I think our managing editor for Nosh, Monica Watrous saw it and she, she posted it on her gram. You didn't send them. You didn't, did you send them any chips or anything?
[00:05:23] Poorvia Patodia: No, we didn't. No, we didn't. We do get, you know, studios reaching out, movie studios reaching out for sponsorship deals or product placement. So sometimes, you know, we'll send snacks, you know, to be helpful. Uh, and why not? Right. And so, but yeah, we did not place that there.
[00:05:39] Ray Latif: Do you have any time to watch TV and eat snacks?
[00:05:42] Poorvia Patodia: I do have time to watch TV. That's good.
[00:05:44] Ray Latif: Okay.
[00:05:45] Poorvia Patodia: You have to have some of that time in your life, right? So, yeah.
[00:05:48] Ray Latif: What's, uh, what's your favorite TV show at this point? And if you don't have any, if it's just movies, that's fine.
[00:05:52] Poorvia Patodia: I don't really watch a lot of TV myself. No, there's something I'm watching right now. What is it? Oh, I'm watching Industry.
[00:05:58] Ray Latif: Okay. I've heard of it.
[00:05:59] Poorvia Patodia: I don't know much about it. On Max or HBO Max. It's this show about investment bankers in London and that whole industry.
[00:06:08] Ray Latif: Exciting.
[00:06:09] Poorvia Patodia: Yeah. Very different from the natural food industry. I'll say that.
[00:06:12] Ray Latif: Yeah, I would assume it is. I would assume they're more interested in robbing you guys.
[00:06:19] Poorvia Patodia: Similar pressures, but different, different types of pressure, I would say.
[00:06:22] Ray Latif: Yeah. I would think so. Anything else that you do to kind of keep yourself even keeled as a, as a founder?
[00:06:29] Poorvia Patodia: I mean, I think the biggest thing is, you know, having a family, right? The whole time that I've been running Vienna, I've been a mom and a wife. And so having kids forces moments and times and hours in your day where you've got to put down what you do and you want to spend time with them, right? And so I think that's a really, really good thing.
[00:06:51] Ray Latif: People who listened to a previous episode that I did with Peter Rahal, who's the founder of RxPAR and most recently of David, are probably going to be a little upset that he answered a question that was the way that he did, but he did offer a caveat. And the answer to the question was, yes. The question was, does hard work mean working all the time? And he said, yes. But he did offer the caveat of, you know, if I'd had a family or if I had personal commitments, it would be a little bit different. He has, I believe he has a new son. He has a young son and he's about to get married. So I wonder if that's going to change a little bit for him. But there are other people who will say, you know, what you said, having a family keeps you grounded, gives you a reason to move away from work and a real important reason to move away from work when you need to. And I think it kind of also sometimes brings you back down to earth about what's really important.
[00:07:49] Poorvia Patodia: Yeah. Yeah. I mean, I like I work a lot of hours. There's just no other way to say it. I work a lot of hours.
[00:07:56] Ray Latif: And so just for context, how many hours a week do you say you work?
[00:07:59] Poorvia Patodia: I don't know, let's say 60 hours, right? So yeah, it's a challenge managing that kind of workload, you know, when you're also raising a family, but family is a great reason to stop working because if I didn't have a family, I would just literally work 24 seven because I'd love what I do and I'm like super engrossed in it. And then I think the other reason, uh, if you want to talk about building a consumer business, it's amazing to look at the world through your children's eyes. Right. And, and it gives you a fresh perspective on food and all kinds of things, you know, it, it helped, I think it helps make you a better business leader.
[00:08:41] Ray Latif: There's a family in the business, this business of better for you food that has been in the news quite a bit lately. And that's the Garza family. The Garza family are behind a brand known as Siete. Siete has been in the news because PepsiCo has decided to acquire the brand for 1.2 a billion with a B dollars. This is great news, I think. But you know, for someone like yourself, who's been in the business for quite some time, who runs a better for you snacking company, I wonder how you evaluated the deal and how you're thinking about it in the context of Vienna.
[00:09:16] Poorvia Patodia: I mean, first of all, huge congrats to Veronica and Linda and the family. I got to know Veronica and Linda a tiny bit a couple of years ago because we were all featured in a Target ad campaign. And so at the video shoot, because we were all there, I got a chance to spend some time with them. You know, great, amazing people and so happy for them. I think that there are some great learnings there for anyone building a brand. And I genuinely believe that in order to really win and build an amazing business and an amazing brand long-term, you need true differentiation in the market. And I think what CFA has done really well is I see when I look at their brand, I see differentiation on two aspects. On the product side, they've built differentiated products that deliver on attributes that other brands are not. In particular, I think their commitment to both grain-free and dairy-free was one of the early reasons that consumers started to embrace the brand. Delivering on something that the consumer wants that other people are not delivering on. That's what really helps you build that long term sustainable advantage in the market. Doing something hard that other people are not doing right for the customer. And then it's kind of wrapped in this super friendly brand, which is all about family and food and culture. And so I think a lot of people can connect with that too. And they brought that to life in some beautiful ways. And so when you combine those two things, it works really well together to both connect with the consumer on an emotional level with the brand element of it, but then also back it up with great products that are really differentiated. And so I think that that concept of those two things working together, you really need that because I think brands are good at one or the other, but when you put them together, you can really create magic.
[00:11:14] Ray Latif: If I'm hearing you correctly, I'm hearing that functionality is really important.
[00:11:17] Poorvia Patodia: The functional piece, as well as the consumer connection with kind of the consumer facing brand, right? Because if you just have the functional piece, it's a little bit more flat.
[00:11:27] Ray Latif: Where does great taste fit into all this? Because I always hear aciete and it seems like taste is low on the hierarchy of importance for people. Strangely, it always seems like, oh yeah, they have great branding, they're grain free, they're dairy free, et cetera, et cetera. And then somehow like, I know their products taste good, but you know, where does that land?
[00:11:46] Poorvia Patodia: Yeah, I mean, maybe people don't talk about it just because taste in some ways feels like it's table stakes in the food industry. But to your point, and something that, you know, with Vienna that we put, we put taste first and foremost. I think people don't talk about it because they think it's a given that if you're going to build a food brand, it has to taste good. And everyone says that, but do you actually deliver on that right for your consumer? And so, yeah, I mean, I, I haven't tasted all the Siete products, but I've tasted a few of them. And I think, I mean, the consumers are clearly embracing it. And so, you know, yeah, I'm sure I know that taste is a big driver of that, I think for any brand in food.
[00:12:29] Ray Latif: I imagine you had a couple investors send you a note about the deal and say, Hey, look at this. Very exciting. When are we going to get ours? And, you know, certainly you're doing great. Vienna's doing great. And there's no rush to do something, you know, or race to an exit. But I have a feeling that investors are just like licking their lips and saying, look at this, you know, look, we could do the same thing. How much does a deal like this put pressure on you or influence your interest in a potential exit?
[00:13:02] Poorvia Patodia: I would say the deal, I think is great news for the industry, for Vienna in particular, it doesn't really put incremental pressure of any kind, because we have a very clear strategy that we're executing against, which is all about building a brand that has long-term sustainable value. And so in terms of an exit, it's not something I'm thinking about right now, because right now we're really just focused on this strategy that we have to build out kind of the two snacking platforms that we have.
[00:13:36] Ray Latif: Let's back up for a second and just talk about Vienna as a brand, where you are right now, and about this dual snacking platform concept.
[00:13:47] Poorvia Patodia: Sure. Yeah. I mean, I think over the last five years and certainly with COVID, obviously COVID was terrible in a lot of ways, but we kind of used it as an opportunity to really kind of reset the stage in terms of what our goals were. And it created a time period where I think as a CEO, I could say, you know what? this business is not about what's gonna happen in the next year or two, or even three years. It's really about what can we do to build just a beautiful brand that is really here for the longterm. And so, when I thought about, and me and our team, when we thought about like, why are we here? What is it that we're looking to build? And when I think about a great brand, there were kind of three attributes that I really focus on. And so like one, it's, Building a mission driven brand that has, as I said before, highly differentiated products and is solving problems for people. The second piece is great margins. And the third piece is really exciting growth opportunities. And those three things to me is a trifecta, right? That's the kind of business and the kind of brand that I want to be working on. And I think is what, what a lot of people want to, you know, strive towards. And so, you know, getting all those three things together in a business, that's That's really exciting. And so that's what we've been working towards. And it's really amazing in the last couple of years, you know, we took a lot of actions to make those things happen. And, you know, here we are in 2024. And it's exciting because a lot of those and some risky decisions that we took. you know, have all kind of come together. And so we're here at a time where we're having, you know, our strongest year yet, both in terms of revenues as well as profitability. So both top line and bottom line with, with strong growth rates. And so it's exciting when you take risks and you do hard things and you know, when those things start to come together and you really start seeing the results of that work.
[00:15:53] Ray Latif: How many doors is BNN in right now?
[00:15:55] Poorvia Patodia: So we're in about 15,000 stores.
[00:15:58] Ray Latif: When you say risky decisions that paid off.
[00:16:01] Poorvia Patodia: Yeah.
[00:16:02] Ray Latif: First of all, what were those decisions and how did you evaluate the risk?
[00:16:05] Poorvia Patodia: Yeah. So the context here is, you know, when COVID hit, we already had a business. And so we had products and distribution and products that were doing well, but COVID hit. And so then all these, suddenly all these things changed, right? Certain things, certain channels, like let's say travel, where we had great distribution and placement that went to like zero overnight. And then other channels like e-commerce and Amazon suddenly shot through the roof. And so we had to work hard to change our strategy to not only meet what was happening in the market, but as I said, to really think about the long-term, you know, and so some of the risky decisions that we took included things like walking away from certain channels that were low margin or customers that were low margin. making decisions around product lines and SKUs. So specifically, for example, we decided to walk away from a protein puff product line that we had because the production was just not as stable as we would like and margins were kind of all over the place. So even though we saw demand for the product line, the margins were not where we wanted them to be. pricing decisions, right? And so, and that was one of the most crucial things that we did, which was, you know, our costs were increasing significantly with the cost of labor going up and our raw materials, freight, things like that. And because we were so focused on kind of the margin piece of what, you know, what being one of the three things that I talked about in terms of building a really great business, you know, we had to take price increases and, you know, we did it probably twice. And that was a really risky decision because we had to cross like a $5 barrier, for example. And, you know, we looked at the data. I am a very data oriented person. So we were looking at things like price elasticities and things like that. And everything we were looking at said that our products are on the inelastic side, meaning that you can increase your price and it's not going to impact your volumes dramatically to a certain point, right? So it will still, it can still impact your volumes, but not to a level that it would be damaging to the overall sales.
[00:18:25] Ray Latif: When you say you have products that are on the inelastic side of things, is it just the roasted chickpeas or is it across the board?
[00:18:33] Poorvia Patodia: Yeah, I mean, I think both of our product lines have some because they're premium and they're delivering on things that the consumer can't find elsewhere. I do think that we have inelastic products in both, but certainly the roasted chickpeas, you know, that kind of protein platform, you know, we took some of those risky decisions around pricing and customers like distribution and things like that. As a result, what we learned is that the brand has tremendous loyalty and has really loyal consumers that are finding unique value in our products and they're coming back and they're buying at the same rate. That was a huge learning for us and also risky at the same time. So we also did other things like we changed manufacturing partners, you know, really every aspect of the business we examined and we kind of re-evaluated the approach and the strategy.
[00:19:34] Ray Latif: Going back to the dual platform of Vienna and taking two very distinct paths to future growth. Was this a decision that has been in the back of your mind for a long time, or does this also come from the data that you've been using and sourcing to make decisions about innovation and new product development?
[00:19:57] Poorvia Patodia: I've always been interested in the salty snack aisle. I mean, the goal here is to recreate the snack aisle with plant-based nutrition. And so, you know, I've always been interested in the snack aisle, but the question was always, is there a job to be done for the consumer that isn't being done by someone else? And so, is there a gap in the market that we can fill? And so, For a long time, I was hesitant to enter into that category if we didn't have a highly differentiated proposition. And there was some data that we saw, I think around 2021, 2022, that kind of opened our eyes up to this opportunity around low calorie snacking. And the data basically said that More than 50% of Americans are on a diet at any given time. Really? Wow. Yeah. I think it includes people that are even just casually watching their weight, right? Even if they're not on an official diet.
[00:20:56] Ray Latif: Does this include things like, I don't know, paleo isn't considered to be a weight loss diet, but you're talking about weight loss diet specifically.
[00:21:04] Poorvia Patodia: No, I'm talking about all diets. Okay. All diets. Gotcha.
[00:21:07] Ray Latif: Okay.
[00:21:08] Poorvia Patodia: And the number one way that they're looking at foods when they're on a diet is still by looking at calories. And obviously we all know that the quality of the Foods and Target quality of the calorie matters, right? Like all calories are not the same. Our learning from looking at that data and the consumer insights was that calories are still kind of a simple heuristic that consumers look at when they turn to the back of the bag. And so when we looked at the chip aisle in particular, chips are still the number one snacking format across all of snacks. And what we were really surprised to see is that there's not a single brand within chips that's really focused on delivering that benefit for the consumer. And so we just thought about it, like, is there something that we could develop that meets our bar for delicious taste and clean ingredients, but also delivers on this kind of nutritional need that the consumer has and isn't being done by someone else? And that's where we came up with our veggie crisps platform and that whole product line, which is you know, most chips have eight to 12 chips in a serving. No one realizes that, right? There's a lot of hidden calories in snacking. You just kind of open up a bag and you just keep eating. And so we created the first low calorie chip that has, you know, 35 chips in a serving. You don't have to stop yourself from indulging and you can just snack away and get kind of this higher level of snacking satisfaction because there's a lot more chips in any serving and it's just four calories per chip.
[00:22:41] Ray Latif: Yeah, it's very clear on the front of pack here. It says 40 calories per 10 crisps on both your flavors. You have a dairy-free nacho and you have a Himalayan pink salt. One thing that is less visible than I think in previous products or as certainly in your chickpea snacks is chickpeas. There's some imagery that includes chickpeas on the front of pack, but it's not like you're leading with chickpeas. Clearly a conscious decision.
[00:23:10] Poorvia Patodia: Yeah. And you know, this came really out of the research we did with consumers as well, in the sense that when they're thinking about eating a healthier snack, it's not as much sometimes about a specific ingredient. You know, no one's thinking like, I specifically want this particular ingredient. It's really that you're trying to satisfy this need for like a healthier option. Right. Chickpeas are veggies. You know, that was a choice that we made in terms of what resonated with the consumer the best. And just this idea of having a veggie-based snack that was lower in calories and truly delicious and crispy and light and crunchy and full flavored, that's really, you know, what resonated the most. And so it just made sense for us to talk about it, you know, as a veggie chip.
[00:23:56] Ray Latif: Yeah, there is one ingredient that I would say that consumers do look for specifically, and that's protein. And you have a protein or you have an anchor for your new protein platform. Obviously, that's the chickpea snacks. I think protein, though, even though it's been having a pretty serious moment, it's still kind of confusing for a lot of consumers as to what the best kind of protein is or, you know, is this protein enough for me if I'm taking a handful of chickpeas, for example, roasted chickpeas? In your research, have you found that consumers are a little confused or they don't care as much where the protein comes from, they just want it? I mean, how have you been able to identify the real need that modern consumers have for protein?
[00:24:40] Poorvia Patodia: Yeah, I mean, I think, yes, there are people who are really focused on, I need to hit this protein goal in my day. And there is a growing number of consumers that are thinking like that, because as you said, if you just look at the Google Trends charts for protein right now, they're just through the roof and they're continuing. It's not a short-term trend. But what we've learned is that when people look at Vienna and our Chickpea Snacks platform, Again, it's kind of a similar learning to what I said about the veggie chips, which is they want something that's generally healthier. They know that this has protein in it. They know it has fiber. And a lot of times consumers are also responding based on what makes them feel full, right? And so they may not articulate that fully, but they know it's like all the marketing and the branding in the world. can help get a brand their first trial with a consumer. But once a consumer has tried this food product, their personal experience with the food is going to reign supreme over any other thing that they hear about the product. And so it's like, yeah, I'm trying this because I see this great protein content. But then once you actually eat it, you know, you know how you feel when you're eating this food. And especially I bring that up, especially for protein oriented foods, because you talked about how protein can be confusing. Right. But there is this idea that when I'm eating protein, it's going to fill me up. I want something that's more solid, that's going to fill me up. And so I think that's what our snacks really deliver on. And that's what people come back for, that they're not getting from other snacking formats. you know, they're not feeling that hunger satiation that they're getting from our snacks. So I think it's a combination of the claims combined with the actual eating experience of the food that people are looking for.
[00:26:29] Ray Latif: When you're getting most or the best response from consumers about your roasted chickpeas, what tops the list? Is it taste? Is it the protein? Is it sort of the texture and taste?
[00:26:46] Poorvia Patodia: I think it's a combination of the taste combined with the protein. And we've had this very intentional strategy from the beginning of going after mainstream snacking flavors. There's a reason why we have a ranch and a honey roasted and a sea salt. It's because these are familiar flavors that people feel good about. It makes them feel comfortable about eating something that maybe they haven't tried before and it helps them bridge the gap. And we will continue that strategy. I think the most amazing thing about the period that we're in now, as I said, we've been working on this strategy to build this long-term sustainable brand that has these attributes around growth opportunities, margins, and mission-driven products. The most amazing thing about the time period we're in now is that we have growth opportunities across both of our product lines, right? And so one of the things I tell founders when they talk about decisions that they're trying to make about their product lines or are they positioned well, is I really encourage people to think about what are the long-term trends that you're positioned against, right? I mean, the whole reason BNN is here and why we're still growing and thriving is because of a decision that I made over 10 years ago when I started this brand, which was at the time I didn't have the advantage of Google Trends, but I was really betting on two trends. One was a trend around protein and the second was a trend around chickpeas. And if you look at the Google Trends charts for those two trends today, over the long term, those have just gone up and up and up and up almost every single year. And they're at their highest peaks and continuing to go up. And so if you can position yourself against those kinds of trends, that's kind of the underlying foundation of what's gonna drive that long-term success for you. So that's kind of the exciting part about what we're doing now is that we've got these two platforms and they're really both growing across multiple channels. And then we have this kind of category leading position within protein snacking that we can really leverage as we build out other products.
[00:29:06] Ray Latif: the foundation of the brand as a better for you snacking platform that had an anchor of protein embedded in that platform was intelligent and smart and forward-thinking for sure. I think there are other entrepreneurs out there that are listening to that and they're listening to this and saying, oh, well, you know, my brand is also rooted and founded and grounded in better for you snacking and great taste. But it takes time to get off the ground. It takes time to get to a point where you can really scale. And that survival mode, I think, is what I'm going to describe it as. That survival mode of the first, you know, one to three years can be really, really tough. A lot of brands, in fact, most brands don't make it. You know, when you were at the outset and thinking about, how am I going to get this brand? How am I going to get BNR at least to a point where I can reasonably say we have an opportunity to scale? You know, what does that survivor mode look like? And how do you get to a point where you're comfortable with saying, okay, we're ready to take the next step?
[00:30:17] Poorvia Patodia: Yeah, I think the biggest thing that determines long-term success, if you really just want to look at the financial aspects of the CPG world and CPG businesses, and I'm going there because when you talk about survival, ultimately you need a strong financial foundation, what creates a strong financial base for any CPG brand? It's a combination of two things. There's a lot we could talk about, but it really all boils down to two things. One is your velocities, and the second piece is your margins. And so you really, your entire job, when you're going from zero to one, people talk about that zero to one phase, which is the hardest phase, because you're trying to get to product market fit. So that's what I would ask founders or tell founders to think about is to think about those two things. And if you can solve for those two things, everything else will fall in line, right? Because if you think about what does it take to get to great velocities, you need both that differentiated product and you need the right pricing and you need the right branding, right? And so you're not gonna get those two things until you, you figure out some of the product side of things. And so that's one thing. So I would, I would talk about building that strong kind of financial foundation, but maybe you could just say it's just the business foundation. And then the other thing I would say is, one of the unique challenges of consumer products is that you're dealing with physical inventory. And that is what really creates a problem for earlier stage businesses, right? That don't have, maybe their internal processes are just being built, right? And so they don't have the discipline or the history to be able to forecast how much to produce so that you're not underproducing and overproducing and all of those challenges. And so, I think that one of the advantages that other industries like the tech space have is that they're not dealing with physical products. And so if you learn that something is not working in the market, you can rapidly just change, you know, your product features or whatever it is you're working on. And so I've created this methodology that we're following at Vienna now, and I call it the build to win methodology. And it's this idea, it takes this idea from the tech industry, which is, I'm just gonna summarize it as sell, design, build, which is you sell first and you confirm that you can sell, and then you design and build. And in our industry, because we're dealing with physical products, it's like, we've got to build first and then see if it sells. So that process and how we have to do things because we're dealing with physical goods, is a huge challenge for the smallest and youngest brands, because inevitably, if you're innovating, you're doing something that isn't known fully in the market. And no matter how much you try to take your best guess at what you think is gonna work. You just don't know till you know. You have to kind of put something in the market to know if this is gonna work or not. And then now you've already invested all this money into inventory and suddenly you learn this flavor is not working or this claim you thought was gonna be amazing is actually not as powerful as you thought or this naming or whatever it might be. And so the idea behind this methodology that I created is the bill to win methodology is Take that idea that comes from the tech space, which is cell design and build, and implement it within CPG. How do you do that? And there's kind of, you know, there's four or five pillars underlying that methodology. So, but it's really about testing and learning in small ways in the market before you make big commitments to do a launch. So that involves creating something, testing it with consumers, putting it into both retail and online, and really getting that omni-channel feedback on whether something is really gonna work and getting the velocities you want, and doing all of that before you make any large commitments around launches.
[00:34:36] Ray Latif: Is the velocities aspect the most important part of that feedback, those insights?
[00:34:41] Poorvia Patodia: Yeah, the velocities ultimately, yes, as well as the margins.
[00:34:45] Ray Latif: So it's not necessarily about, oh, a consumer emails you or you do a survey and finds out, oh yeah, I like this, but you could change this or this or that. If they buy it, you probably know it's going to work. I mean, if enough people buy it.
[00:34:57] Poorvia Patodia: And then can you rapidly iterate on the packaging also? So if I look back at our veggie crisps line, we've actually changed packaging on that product line maybe four times already. And if you just looked at the front of the bag, you might not realize it, but we have made like some really significant changes to that packaging within a matter of two years. And so you just have to be bold in terms of you can't get stuck on what you think is best. You have to really focus on solving the problem for the consumer. And there's this great book that I read last year, I think it's like, fall in love with the problem, not your product or something like that. And so this whole build to win methodology, that's really what it's about, which is rapidly iterating, you know, how do you create a test and learn infrastructure within a consumer products business that allows you to rapidly iterate and solve the problem for the consumer in the best way possible, rather than getting stuck on your first execution or your second execution of what this product does.
[00:36:05] Ray Latif: All such great advice. And I love, you know, your approach to thinking about the problem and solving a problem and creating a solution that really fits a consumer's need and many consumers' needs. It's really hard to do that if you don't have money to do those things. And obviously the number one question that I get from entrepreneurs is, do you know any investors? Do you know any people that are willing to help me fund my business and Yeah, there's people out there, but it's, it's tough. And then even if you do get money, you're gonna need more money. You guys are in a good place. You've raised money. You have plenty of cashflow at this point, but, you know, early on, what was, you talked about the importance of, you know, financials. How do you make sure you have enough money on hand to be able to not only survive, but think about that future for your brand?
[00:36:58] Poorvia Patodia: Every entrepreneur's journey is unique, right? And their access to funding is different. You wanna be able to get to a point where you have some success that you can share. You wanna raise money at a time when it's gonna be the best time for you to raise money for your business, right? And so a lot of times that's about showcasing that you've reached certain milestones. whether it's ideally actually both in terms of the growth of your business and traction, showing that traction, but then also showing that you have kind of this financial infrastructure that will lead to a long-term business. The big thing for entrepreneurs to think about in CPG in particular is how do I get myself to a place where I can show some of that early traction as well as the financial acumen in the business? because that's what's going to allow you to raise money under ideal conditions. And until then, I would try to beg and borrow money from friends and family, you know, from friendly investors that would allow you to get to that stage.
[00:38:06] Ray Latif: It's kind of hard sometimes when you have an investor meeting or talking to an investor and they're like, what's this $50,000 charge back from this distributor? And trying to explain the nuance that, well, I call it nuance, the challenges, whatever you want to call it, the awful part of the business that no one tells you about. You know, those are parts of the food and beverage industry that I think a lot of people are surprised by is the hidden costs or the things that don't necessarily show up on a balance sheet or you wouldn't expect them to. How do you mitigate those costs? You know, again, for people who are relatively new and signing on with big distributors, what's your advice there?
[00:38:45] Poorvia Patodia: Yeah, it's actually interesting because last night I was at an event and I saw a founder that I've known over the last couple of years. And she was asking me that same exact question. She's at a crossroads where she has a distribution opportunity and she has to select a distributor. And so she's getting this kind of opposing advice. And I think when you're working with large distributors, you are playing with fire in a way because of exactly what you said, which is one of the challenging things about CPG is that chargebacks and deductions come to you after the fact. And the people that are putting these deductions in place have access to your money. And so that, and that's kind of how the system works. Let me just talk first about the distributors. I would select a distributor where you can access people, where you can pick up the phone and you can reach out to somebody if there's a problem. And it's very simple advice, but that's really, really true. And I wouldn't worry about margins in the sense that some distributors will take lower margins than others in terms of, you know, the markup that goes on top of your brand. But you need to build your pricing in a way that it doesn't tie you to a specific distributor, right? There needs to be enough margin in there for both a distributor and a retail partner to be able to take the margins that they need to get the product to shelf. If you set up your pricing in a way that ties you to a specific distributor, that's not going to be a sustainable way to do your pricing. So first of all, take those shackles off yourself, develop a good pricing structure that gives you the freedom to work with whatever distributor is right for that particular distribution opportunity. And if you're starting out, select a distributor partner that has people that you can access on the other side where you can build a relationship and they're going to help you, you know, really be in the foxhole with you solving problems.
[00:40:48] Ray Latif: And those are typically regional distributors.
[00:40:50] Poorvia Patodia: Yeah. Yeah. Yes. Yeah. And Vienna started the same way. You know, I chose a regional distributor when, when we got started and that was absolutely the right thing to do for the brand.
[00:41:03] Ray Latif: I've heard many stories like this, but I remember the one, this is in Beverage, the founder was expecting to get, I think, a $50,000 check from one of his distributors or get paid by one of his distributors. And I think he got an $8 bill.
[00:41:17] Poorvia Patodia: Oh my gosh. Those are scary moments. That can be a scary moment. Yeah.
[00:41:24] Ray Latif: Yeah. You know, this business is tough. I mean, everyone who has ever created a brand, I think a couple of years in they realize just how difficult it is, but I think the rewards are. not endless, but the rewards are very valuable in that you are your own boss in a lot of ways. I mean, I think, you know, certainly you're investors, you have to answer to them and you have to answer to your own employees, but you're still your own boss. And if you're doing something right, if you're feeding people good food, that's definitely something you can hang your hat on knowing that you are adding to a solution or helping Americans or whomever eat better than they had been prior. I think that's a great thing. I think you're doing that with Vienna. And I'm so happy that we had this opportunity to chat, Porby. Thank you so much for coming out to BevNET HQ here. And I think we'll probably have to do this again. At least a couple of years. Yeah, maybe another five years. Yeah. The last time we had you on was 2017, but I don't think it's going to be that much longer before I ask you for another sit down.
[00:42:30] Poorvia Patodia: Yeah. No, thank you so much for having me. And this was a really great conversation.
[00:42:34] Ray Latif: I agree. Thank you again.
[00:42:35] Poorvia Patodia: Thanks.
[00:42:39] Ray Latif: That brings us to the end of this episode of Taste Radio. Thank you so much for listening. Taste Radio is a production of BevNET.com, Incorporated. Our audio engineer for Taste Radio is Joe Cracci. Our technical director is Joshua Pratt, and our video editor is Ryan Galang. Our social marketing manager is Amanda Smerlinski, and our designer is Amanda Huang. Just a reminder, 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. Check us out on Instagram. Our handle is bevnettasteradio. As always, for questions, comments, ideas for future podcasts, please send us an email to ask at Taste Radio.com. On behalf of the entire Taste Radio team, thank you for listening, and we'll talk to you next time.
[00:43:29] Whole Foods: you
