Hey, folks. It's Ray with Taste Radio. Right now I am supremely honored to be sitting down with Chris Kirby, who is the founder of Ithica Hummus and co-founder of Guillermo's Salsa. Chris, it's wonderful to see you again. It's great to be here. Thanks for having me. Yeah. The last time we sat down for an interview, here in the Boston area at least, was in 2019.
You came to our Watertown office. We're here in Newton, just down the road, and our digs are a little bit nicer than they were in the Watertown days, would you say? Would you agree? Nicer, but I really liked that place. It was nice. It was nice. Cozy. Lot of natural wood, if I'm remembering correctly.
You were remembering it... Yes. You have a good memory. It was super nice in there. Yeah. That was seven years ago. Crazy. Yeah. How many years were you in for Ithica Hummus at that point? That was probably, what, maybe seven or eight? Okay. Yeah. So you had started Ithica Hummus in 20- 13. 2013. Okay. And here we are 13 years later.
The brand has grown by leaps and bounds. It's everywhere, which is amazing. That's an entrepreneur's dream. For one day you... to be in 10 stores and see how your brand's doing, resonating with consumers and small retailers, to be in tens of thousands of stores. It's amazing what you've accomplished.
The one thing that will never change is it always feels amazing to get good product feedback. When you hear from somebody who really loves the product. Yeah. That's felt the same the whole time. Am-amazing. Yeah. It was, I believe, in 2017 or '18 when I first was introduced to Ithica Hummus, and it was at Expo East, back when Expo East was still in Baltimore.
And I remember tasting the hummus and thinking this was some of the freshest, most delicious hummus I've ever had in my life. And I posted on Instagram, "Don't walk, run to booth," whatever the booth number was, "Ithica Hummus," 'cause I was so impressed with what you were doing. And a lot of it had to do with your processing method and the fact that you were using premium ingredients, and we talked about that in 2019 in our interview.
And one of the primary takeaways for me from that interview was how intentional you were about everything, from the ingredients to the packaging to the discipline and focus on profitability. And I think that philosophy has really set you on a course to the success that you've seen since. Has that been the path?
Has it been a path carved by discipline? Maybe not as much as it appears, to be totally honest. I'm glad Leo's in the room to hear this because it's been a process of letting go slowly and intentionally And just for our listeners, Leo is here with us. He is the president of Guillermo Salsa.
Looking the part, if I may say so. 100%. I'll just give you some context. Leo is dressed like a corporate executive if a corporate executive was working for the coolest company in America. Does that make sense? Does that- Yeah. Okay. Totally. You nailed it. Yeah. Leo has always been a vibe since I knew him in his prior life at his last company, which is why when this idea for Guillermo's really came together I knew there was one guy that I needed to call and it was him.
And it goes back to what you were saying, right? Like When you've never done something before, you don't know what's important, so it all has to be important. You have to be maniacal about all sorts of things that, looking back, you didn't really need to be that crazy about, but you didn't know any better.
So you, you just have to keep the Whac-A-Mole game going for long enough until you, you reach different levels of success and inflection points where you can backfill with resources to add more support and structure to a, business that you're ultimately trying to build. So he's going through that very much in the thick of it with Guillermo's right now, so very appropriately timed question.
You're not talking about micromanaging though, right? You weren't micromanaging the business. I-- No, definitely gotten micromanagy, but try not to, certainly intentionally try not to. I just try to act with a sense of urgency on a priority list of things that are like, this is the most important thing, and then we go down from there and just try to instill urgency in the most important thing at any given time.
For me, if I were a founder, the most important thing would always be taste and quality. And Ithaca defines, for me anyway, taste and quality, 'cause if you don't have that, you have nothing. I've said that on the podcast a number of times. Is that always the top priority for you? No. Yes, but no.
No, because, you work hard enough, long enough at something like building systems and processes and teams around things that are really important to you and your business, and eventually you get really good at them to the point where they're, they become a core competency and they don't necessarily require as much attention as they once had, right?
So that's also the fun part of being an entrepreneur is you can kinda go deep on things, but then move over into some other area that's totally new and refreshing and exciting. What's an example of a core competency that you have to get right for your business anyway? No, you hit it on the head.
First and foremost, it's product. It's product, hands down for me. You have to have, in whatever category you're entering, you must have the best in class product. You have to. It helps to have a brand that people are really excited naturally to talk about, and they just talk about it on their own without a lot of help or pushing.
But first and foremost, you have to have the best product. And best product means a lot of things. Quality is a lot of different taste, texture, specifications, food safety, shelf life, packaging. You wanna have the best product. I've always stood by that. How do you know when you have the best product? As a chef, for me, taste.
And I think consumers, taste is number one. It's gotta taste good. It's gotta be craveable almost. After that Food safety. Food safety arguably is really number one, but from a loyalty and repeat rate perspective, it's taste. And then, something I didn't really even mention earlier, it's your ability to supply, yeah. Reliably, consistently. I don't think people realize and respect the importance of doing what you say you're gonna do. And the fact that retail buyers complain about this all the time, which is, "You said you were gonna do something. You said you were gonna give me this, and you didn't give it to me."
And I remember talking to you about that and how important that was to you specifically. Yeah. It's important to me because it's been important to our chief operating officer at Ithaca, Frank Cavallaro. I mean- His last career before he joined me at Ithica, one of the things that made him remarkable was the relationships that he cultivated with the vendor community in his business.
And so we inherited that from him, but it is absolutely a superpower when, a customer, whether it be Costco or Publix or Walmart or, Greenstar Food Co-op, if they know they can rely on you, it puts you in a little bit of a different class, which helps over time.
Profitability, gross margin, where those fit into your hierarchy of importance? You have to have them, but I don't think you necessarily always have to target them directly. I think if you get the fundamentals right, those things will come. What are the fundamentals that you're talking about? Best-in-class product, ability to drive trial and awareness, repeat rate, because you've got the best product.
When I ask you about micromanaging, it's because you are transitioning from Ithica to focus specifically on Guillermo's. Now, you're not starting back at step one of entrepreneurship, obviously, 'cause you've had a lot of experience under your belt, but launching a new company, launching Guillermo Salsa, is in essence getting back to square one.
And I would think that you're taking a lot of the lessons and a lot of the understanding of how a CPG business works and applying them to Guillermo's. Obviously, best-in-class product. This time you've got a quasi-celebrity. I'll call him a celebrity. Guillermo's a celebrity, yes? He's half celebrity, half mascot.
Okay. Yeah. That's a good way of putting it. Helping you get the word out about the brand. At the end of the day, the product's gotta come off shelf, and one of the themes of the last conversation we had about Ithica was really about velocity and retail productivity before chasing massive distribution.
Now, you both, Leo, you are here talking to a lot of retailers while you're in the Boston area. How cautious are you about growing too fast? How cautious are you about making sure that the product works first before chasing wider distribution? Very, and so much so that we designed our launch around super simplicity, one product, twenty-six ounce One customer, Costco, medium salsa, that was it.
And the first better half of 15 weeks, basically, that's all we've done in two regions now, in Northeast and Southeast. For Cinco de Mayo, we did launch with Tops, Price Chopper, and Wakefern. So we brought on about 400 doors in the more conventional channel. And so that took us from one product to now four, because we had to add a 14-ounce line to our 26-ounce club pack.
We're now doing 14 ounce in three flavors, hot, medium, and mild. So it's started out as a very simple business. It's still a very simple business, and we took the leap of one to four very seriously because it was important to us up front to use this simple kind of like high volume, great customer, club channel.
It's like kind of a dream launch, honestly, to learn about where do we have holes in our system? Where do we need to work? Where do we need to get this set up, that set up? And then I feel like we're at the next inflection point where we could probably handle 5,000 doors with the four products that we have now and then it really becomes about team.
Right now it's just kinda Leo and I, but we desperately need to add to our small but mighty team, and we're working on that. But yeah, very intentional about how we launched and continue to scale. Where are those holes that you need to fill in terms of staffing? We need someone to really run ops. We would love to have someone who can sit on top of both sales and marketing join the team.
The way Leo puts it, we're looking to put our best five out on the floor immediately. Sounds like you're wanting to grow a little bit faster than you did with Ithaca. Is it because the dynamics of CPG have changed? It's 'cause I have more money now. That's part of it. Okay. Oh, that's the fair answer.
Yeah. I couldn't do it back then 'cause I had a few thousand dollars, now I have more, access to capital and relationships. Access to manufacturing and capacity, that's huge. I have that. Guillermo's-- Just like Ithaca was a partner with Lidestri Foods, Guillermo's is-- We launched in partnership with Giovanni Lidestri and his family.
So no, we've got it all set up to scale pretty quickly, actually. Again, this is something we talked about seven years ago, but I think it's really important to reiterate, which is that your co-manufacturing partner is perhaps your most important partner. If you have someone that you can rely upon and they can rely on you, the sky's the limit.
How have you cultivated that relationship such that it's been great since the beginning and great through your next brand? I'm glad I have another opportunity to talk with you about, have the same conversation 'cause last time I probably didn't even realize how special and unique and rare the relationship that I have with Lidestri is, and probably talked about it like more "Yeah, just go find a co-packer to get money from an investment."
And it's just not easy. So I'm super grateful that's a big part of my story and the Ithaca story and now Guillermo's story is Lidestri Foods. It gives you all the benefits of owning manufacturing without actually needing to own the assets, which is an incredible advantage. Lidestri, correct me if I'm wrong, they have a stake in Ithaca.
Yes. Yeah. And I think that's a question That some founders have to ask themselves how comfortable they are with a manufacturing partner as an equity partner in the brand. Clearly, it's worked out for you. Does having a chip in the game for Lodestar, does having that equity partnership, do you think that gave them not only confidence, but even more motivation to support the brand and make sure that they're delivering on that quality and taste that you're known for?
Yeah. For them it did. They're arguably some pretty unique and exceptional people with a pretty unique and exceptional business just like us, so we got lucky to a degree. I don't know that would be true in every manufacturer-brand relationship, but yeah, for us, we got favorable terms that put us in a negative cash conversion cycle basically way before a business of our size could have achieved that.
We can call them on a Sunday and say, "Hey we got an opportunity to fill two times our orders next week. Can you add more shifts?" And, they could very well do that. We have all sorts of transparency to supply chain and ingredients, but we have all the benefits of basically turnkey manufacturing, so it's pretty awesome.
It sounds pretty awesome, and it's needed for a category they're carrying, which is refrigerated foods. It's a dream partnership for any brand that's sub 100 million, 'cause until you get to that size, you really can't profitably operate your own manufacturing in most cases. Yeah. So we just got extremely lucky.
But if founders and brands out there can aim for that, it is a very good place to be. What do you see in salsa that you thought could be disrupted? Refrigerated salsa in particular, because again, refrigerated is tough, and we were talking about this upstairs, and spoilage and buybacks and all kinds of other stuff that can happen in that space that are not great outcomes for refrigerated brands.
Yeah. For me, small price to pay for the opportunity that I see here, because salsa is almost a $3 billion category when you combine center store and refrigerated. Center store is two-thirds of that. A third of it is refrigerated. Center store is declining, and refrigerated is growing, so there's this natural migration of consumers going from the center store for salsa to the refrigerated set in produce.
And, we see Guillermo's as a brand that's going to accelerate a trend that's already happening with consumers. So strategically, a lot of our messaging has that kind of find us in the cold set baked in- ... because that's, that's just where we see the tide turning, and we wanna get there and get as big as possible before anybody else does.
There's a migration, and there has been consistently, of better-for-you Going from Whole Foods to places like Costco to Target to Walmart and elsewhere. And I think this halo of better for you isn't specific to natural anymore. It's very much a broad term that can be applied to different parts of the store in a lot of retail channels.
But better for you doesn't necessarily mean better tasting, and I think one of the best parts about Ithaca is that it was never really presented as a healthy brand. You could see it and you'd know it's a healthier brand, it's a healthier option, but the indulgence is what you were selling, and I think that was the secret power that a lot of better for you brands miss out on.
How intentional were you about talking about the indulgence factor versus the, "This is healthier, this is better for you"? I think that's a great point. I think That we were intentional about what we didn't say. We're not here to make all these claims and say that when you eat our hummus, your skin is gonna glow and, it's just...
Yeah, it's just a better product. It just tastes better. And I'm also a fan of just kinda keeping it simple and minimalist packaging. I think it makes it easier for consumers to create content that is about the flavor. You go on TikTok, you go on Instagram, people aren't necessarily hyped about, "This is so much better for me than the alternative product.
This is gonna make my skin glow." They're talking about, "This tastes amazing." Yeah. And you see them eating food, and you see them, crackers or celery or carrots dipping into the tub of Ithica hummus, and people's mouths are literally watering. Yeah. And I think having an indulgent product, delivering on that indulgence, helps with the marketing as much as it does with anything else.
Totally. And that is what we want. That's what we want consumers to be excited about. The headline is, "This tastes amazing. It's indulgent. You're gonna enjoy eating this. And oh, by the way, yeah, clean ingredients, super healthy, good for a well-balanced diet." But yeah, headline is definitely taste.
How does it work with Guillermo? Is headline still gonna be taste, or is it gonna be- That's a great question. Yeah. It's probably star power is probably the real headline. The real headline with retailers is, "Look, what Guillermo can do for this category and for your shelf is we can bring incrementality and excitement guaranteed."
We've already gotten 350 million impressions on the brand in the first 15 weeks. We've done nearly 3 million in sales, which, you know- That's insane ... it took years- Yeah ... combined, three years combined. First three years of Ithica, I didn't do the same amount of sales we've done in, three months at Guillermo's.
It's the same game, it's just at a different scale. Faster. You get people excited by Guillermo and the fact that he's launching a product and a brand that seems to be in line with who he is as a celebrity, as a mascot, as you put it. Yeah. But then you gotta deliver on the taste. You gotta keep them coming back.
You can get someone to try a product once, and then they'll never come back, unless it's delivering on everything that you say you're gonna deliver on. I think all that being said, how do you keep this momentum going? How do you keep people excited? Is it important for the brand to keep Guillermo as popular as possible such that the brand is benefiting from his popularity, is benefiting from his celebrity, how does he fit into promotion of the brand? How does he help not just the brand at, in, year one, but year five? Does it make a difference? Yeah. Another really good question. I think what people don't give enough credit to celebrity brands done well is, yes, he's a megaphone. His celebrity can bring awareness in real time to the brand.
But the bigger benefit, I would argue, is that Guillermo as the brand starts out with a brand story that already resonates with people, and people are already excited to share because Guillermo is already a known entity. People know who he is. So from a storytelling and brand perspective, it puts us on a starting line that's way out ahead of, like, where I was at Ithaca, for example.
No one knows what that is. People know who Guillermo is. And so number one, yeah, best quality product, that's table stakes. And with enough time, that's a winning strategy alone, and you can see that with Ithaca. But if you can combine best in class, best quality product with a brand that people are really excited to talk about and tell their friends about, more importantly, now you've really got a formula for accelerated scale and growth.
And you just... at that point it's just about do we have the manufacturing supply to support that? And that's the winning formula that we're betting on here. Some founders who are not celebrities have a great story, and they're able to share that story in a way that's compelling to an end consumer and helps them get acquainted with the brand, try the brand, try their products, et cetera.
I think in your case, your founder story came gradually and gradually to be incorporated into the brand. But how much of an impact do you think your personal story in the development of Ithaca had? Not a lot, and I don't really want it to. There are a lot of founders who do a really good job with that, and I think it can have massive impact and benefit.
But no I just like to be an operator, and stay in the weeds and More than be central in the story of the brand. The founder as the brand, I feel like has been a theme over the last five years, and perhaps us in the media have been pushing that narrative a little bit too much.
But, you think about a Poppy, an Alison Ellsworth, she was front and center in all those TikTok videos. Yes. I feel like it had an impact because she is the consumer as much as she is the founder. Yes. Yeah. But it doesn't, as you pointed out, it's not necessarily for everyone, and I think in the case of Poppy, the operations mattered as much as the marketing.
Perhaps maybe one was a little bit more important than the other. In your case, it definitely feels like the business is the business. We're not necessarily selling hopes and dreams. We're selling hummus. Now you're selling salsa, and we've gotta sell it well. Yeah. Yeah. And I think the allure of CPG and the magic of seeing your product on shelf and being in love with what you're selling can sometimes take away from the nuts and bolts of business, and it's important for I think, for our listeners to hear this because at the end of the day, you gotta sell a product, you gotta sell it profitably, and that seems to be something that is inherent in who you are as a founder.
It is. I look at the business itself as a product that's being built. Is it good? Is it bad? Is it a good business? Is it one that I wanna continue to work in or not? I look at the business as a product itself, and I have a lot of fun building that too. The business as a product, but who are you selling it to?
The shareholders or I guess the market, anybody who would put a value on it. And are those folks who are buying or investing, buying the business or are they buying the brand, would you say? Especially in today's market. You could honestly do either one. In Ithaca's case, it was both. And do you think it's the same with Guillermo's?
Because right now it feels like you're brand building more than you're business building, but I could be wrong. No, we're definitely doing both. Yeah. Yeah. Leo, again, is his work at King's Hawaiian with Irresistible Foods Group, he went through diligence with a lot of companies. He knows what a well-organized company, organization looks like.
He knows what, a good P&L, even down to, the actual fundamentals of the margins and things. He's assessed a lot of these businesses, so he's setting up Guillermo's in a way that is just gonna be a well-run and well-organized business. Do you need to fundraise? No. No? Is that something that your perspective has come from Ithaca not wanting to fundraise because of your experience building that brand?
Yeah. Everybody who I want to have equity in Guillermo's already has it. Fortunately, between the shareholders that we've assembled, we can fund it as needed. I'll ask it a different way, more provocative. Do investors sometimes get in the way of running a business? Yeah, absolutely. All-- I would argue 100% of the time.
100% of the time. With the exception of Ledet Street and Bush Brothers, they've been great. But I've been really fortunate and have not had to bring like aggressive investors onto the cap table of Ithaca or Guillermo's. I like it that way. It's just when two parties come together that really aren't aligned in what they're trying to accomplish and when and why, it can be a recipe for disaster sometimes.
Yeah. I've heard that, and I've heard of really terrible stories where founders get kicked out of their company, which is the worst-case scenario, right? Yeah. But you need money, especially if you don't have money to begin with, and you've gotta pick well, and hopefully you find people who are aligned with your vision and don't get in the way, but it's hard.
If you were a founder today who did need capital, what would be your process? Having gone through what you've gone, what would be your first plan to raise money? Would it be debt financing? Would you be looking for one single investor versus multiple investors? How would you advise entrepreneurs today on how to raise money?
I would advise them to spend more time with their unit economics, get those right, and then go sell stuff because- That's how you wanna raise money. It's gonna take longer, but if you can sell stuff profitably, you're bringing more capital into your business, then you might have to grow a little bit slower.
But that's always where I would recommend starting. And that's not always gonna be possible, to be fair, but generally it is to some degree. Focus on your unit economics. This is where building a great business comes into play, because if your margins are better, you raise less money. But then I would look for strategic partners who can bring more to your business than just money.
'Cause they're gonna bring more than money. They're gonna have requirements and demands, and you may have to set up a board and, now all of a sudden precious time and resources get sucked into maintaining your, relationships with people that you've raised money from, and that, that's not what I wanna spend time doing.
That's why I like to be an operator. I wanna be solving business problems and working with consumers on packaging and pricing and product, and that's what I like to do. There's lots of advice out there on this. I think my message is just do everything you can to not raise money. Do everything you can to be self-sustainable and bootstrap for as long as you can, because you'll learn a lot in the process, even if you don't have a business at the end of that, and maybe you'll avoid some pretty nasty years of life.
I've seen it happen too many times. You've seen it happen, or has it happened to you? No, it hasn't happened to me. Okay. I've had plenty of bad days, nights, weeks, months because of my business, and things imploding and all sorts of disasters, but never on at the risk of losing my company to a shareholder or an investor.
What was your worst day with Ithaca? There was a period of time a couple years ago where we were like deep into diligence with a couple of different parties, and it just felt like- To sell the company? Yeah. Yeah. And it felt like I was just being poked and prodded at, and I was just-- It made me really uncomfortable.
It's not fun. It's not fun when you're, going from meeting to meeting full of people who are trying to dissect everything you've done wrong and right in your company. I don't recommend it. Was it because you were uncomfortable with the fact that people thought you were doing something that you shouldn't have been doing or did they just not respect you as a founder, as an operator?
No, it wasn't that. Honestly, in fairness, we were in a rough period where we had just gone through like a repricing exercise. We changed our pricing and our promotional... This was like right after COVID. And we brought our average retail price up from four forty-nine to I think four ninety-nine by taking everyday price up a little bit and changing our promotional.
And so it affected velocity. So we were looking at like year-over-year data that appeared to be like velocity was slowing down. And it was, but it was more of a pricing issue than a velocity issue. And so honestly, it was a bad time for our business to be under that kind of scrutiny and that just combined with it being pointed out to me like relentlessly over and over.
Like I know. I know. Our velocity year over year doesn't look good right this second. But there was also-- there's been lots of stuff in the hummus category from competitors being in and out of the market, and it's kinda been a wild ride the past few years. But fortunately, we're really coming out on top- Yeah
now. What was the best day you've experienced with Thica? Probably the day I raised money from Ledestre. We finally had some like fresh capital that came into the business after years of just slogging it out, just grinding for years. And finally had... It was like almost three million bucks. One check, sold twenty percent of the company, and I was on top of the world.
'Cause I was, doing everything at that point, sales and that. And the day we closed Publix. We closed Publix for the first time in August, I think, and by September, four weeks later, we were shipping like a full truckload of product to them. Wow. Which was... Yeah. That was all Frank and Ledestre.
See, that's the kinda thing that we're able to do because it's like we're all in the same family. We're all under the same umbrella. Yeah. I wanna go back to one thing that you said though, which is when you meet with retail buyers they say for us to take your product, we're gonna have to kick somebody else out What gives them the confidence that by kicking the other brand out that you're gonna do better for them, that you're gonna deliver on those incremental sales that they wanna see in their stores?
That's the whole pitch. That's the big question is if they're doing two million dollars a year, you need to do more than two million a year if I take them out and put you in. And so yeah, you have to convince them without data, which is how we are, right? Club data doesn't necessarily translate very cleanly to like projected velocities in the conventional channel.
So we have to, put on a good smile and put on a good show in there at this point because we don't have a lot of data to point to. But ultimately it's a data story. It's a you story too. You've been successful in this business, so they can trust that you're gonna deliver or have probably more confidence that you're gonna deliver on something than someone who's a brand new first time founder in this business.
Yes, I do get my moment in the sun where I get to say, "Hey, I've built a refrigerated brand before. I know how to get the job done when it shows up on shelf and start moving units and driving velocity." I can take them through that, so yeah, experience pays off. I often ask this of entrepreneurs at the end of our conversations, and usually the answer is a straight up yes, but sometimes it's a qualified yes.
Are you happy? Yeah, I'm happy. I'm happy. No qualifications needed. Yeah. Is it contentment happy or is it just you're happy that you've built a successful brand, now you're on your way to building another one? Yeah. I feel like I'm in the bonus round. Yeah. I had success with Ithaca. I've got three amazing kids, wife, amazing family, and now I get to work with even more amazing people and continue to build my professional network with great people working on really fun brands.
I just-- Yeah, I'm super lucky. I feel really fortunate. I'm very happy. I'm very happy we had this opportunity to sit down. Me too. I'm very fortunate. Thank you so much for traveling from North Carolina and Leah, where you come from? Miami. You guys came far and wide to Boston and luckily it's a nice-ish day here, so really appreciate it.
Chris, congratulations on everything you've built to this point. It's really remarkable and you're one of the founders that founders look to and say, "I wanna be like that guy. I wanna be like that person." So thanks for doing what you're doing and good luck with Guillermo's. It already seems to be off to a fantastic start.
Thank you. Thank you again for being on Taste Radio. Thanks for having me.
