BiggerPockets Business Podcast

BiggerPockets Business Podcast 19: From “Naive” Newcomer to 8-Figure Revenue in 4 Years with Barnana Co-Founder Nik Ingersoll

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Prepare yourself for an incredible tale of entrepreneurship. It features a hardscrabble upbringing, relentless optimism, negotiations with Amazonian tribesmen, and some bold guerrilla (“gorilla”?) marketing stunts.

Barnana has been making organic banana snacks since 2012. The founders call bananas “Mother Nature’s energy bar”—hence, the name.

When they started, they didn’t have much money of their own. So, they had to build a business that appealed to investors.

Today, co-founder Nik Ingersoll reveals exactly how they did that. You don’t get into 20,000 stores (including heavyweights like Whole Foods and Costco) without money. But as Nik explains, it doesn’t have to be YOUR money. In fact, one of the most valuable parts of this episode is Nik’s story of how he used “lean startup” principles to raise Barnana’s first round of funding.

Also, ever wondered how much it actually costs to make that healthy snack you’re munching on? Well, Nik breaks down Barnana’s supply chain and profit margins in detail—from working with distributors/middlemen, to using brokers to get Barnana’s products into stores, to getting certified as “organic.”

And he shares some great ways he’s generated free publicity over the years, including the launch of this farcical new product.

This is one of our best episodes yet. Tell us what you think, and subscribe to the show so you won’t miss an episode.

Click here to listen on iTunes.

Listen to the Podcast Here

Read the Transcript Here

J: Welcome to the BiggerPockets Business Podcast, show number 19.

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Nik: … and so, by virtue of just literally not having a dollar to my name or to my family’s name, period, there really was no other option, right? Like, I didn’t have 20 grand to just go spend on a production run. It just wasn’t an option.

J: Welcome to a real world MBA from the school of hard knocks, where entrepreneurs reveal what it really takes to make it. Whether you’re already in business or you’re on your way there, this show is for you. This is BiggerPockets Business.

J: Hey there, everybody. I am J. Scott. I am your co-host for the BiggerPockets Business Podcast, and I am here again with my lovely co-host, Mrs. Carol Scott. How you doing today, Carol?

Carol: Honey, super great. And also, super grateful. I’m grateful that we get to be a part of this show. Every single week, we talk to guests who are so inspirational, have done amazing things, and they give so many great tips and actionable items, and I love being able to talk with them, and educate our listeners and help them reach their goals. So I’m really grateful for that.

Carol: And speaking of our listeners. Listeners, we would love, love, love to hear even more from you. We want to learn more about who you are, and we would love to get your feedback, okay? So, here’s what you can do to help out. We set up a form online, so go to biggerpockets.com/bizsurvey. That’s biggerpockets.com/B-I-Z-survey.

Carol: You can fill out some information on there, give us all of whatever you want us to know, what you want us to do better, do differently. What you like, what you don’t like. And we might even reach back to you and request a five or ten-minute phone call so we can chat with you and really hear everything you have to say. So again, biggerpockets.com/bizsurvey. Help us make this show even more relevant to your world.

J: Absolutely. And thank you to everybody for all the great feedback you’ve already provided. Thank you for the great ratings on iTunes and the comments that we’ve received. We really appreciate all the feedback.

Carol: So much. So, so much.

J: Now, with that said, let’s jump into today’s show. Today, we have a really great episode. We’re talking with a gentleman named Nik Ingersoll, and he runs a business called Barnana. And so, Nik, a couple years ago, was nominated … or not just nominated. He was selected as one of Forbes’ 30 under 30. So he’s been a serial entrepreneur for the last decade. Probably more than the last decade. I don’t know how far back his entrepreneurialism goes, but he tells us about some things he was doing in middle school to start out his path to entrepreneurial success.

J: But these days, Nik is running a business called Barnana, where they buy, manufacture, and sell treats made out of bananas. And he has built this business tremendously over the last few years. They’re in Whole Foods. They’re in Costco. They’re everywhere.

J: And so, Nik’s going to tell us all about how he launched this business. He’s going to take us through his supply chain and how he actually creates and makes and sells these products. And best of all, he’s going to tell us how he started out in this business. Basically, this is a very capital-intensive business. This is a business that takes a lot of money, but he got his start in this business by doing one thing that allowed him to start the business almost risk-free.

J: He basically got the opportunity to start the business with no money out of pocket before he knew for a fact that he was going to be successful, and he talks all about it. So, with that said, let’s jump into our show with Nik Ingersoll.

J: How you doing today, Nik?

Nik: I’m doing fantastic, man. How about you?

J: I am doing well. Thank you so much for being here.

Carol: Yeah, thanks for joining us. This is an exciting one, and we’re so looking forward to talking with you about your current venture, as well as so many other facets of your world and your story. It’s very exiting.

J: Yeah. It’s awesome because your story and what you can teach our listeners really extends so much past your current business, and we want to give our listeners some context. So, can you give us a quick overview of what you’re focusing your time on over the last few years? And then, we’re going to jump back and we’re going to talk through your origin story and build back up to where you are today.

Nik: Yeah, sure thing. So, over the past few years, I’ve been primarily focused on Barnana. Previous to that, I co-founded a tech company in undergrad, and Barnana was founded shortly thereafter. And so, I’ve just been ruthlessly focused on building the brand and building a business.

Nik: It’s a company that I started with two co-founders in 2012 in San Diego. We moved up to LA shortly thereafter, and it’s been a wild ride. We sell organic, premium snacks in places like Whole Foods and CVS and Starbucks and all over the place.

Nik: And it’s been pretty cool. We take, essentially, bananas and other fruits that used to go waste at farms, and upcycle them into tasty things that you can eat, instead of composting them into the ground.

Nik: And so, really, the last several years have just been constantly working, grinding, making the brand better, getting distribution, optimizing margin. Everything that you have to do, including raising capital, to build a successful food CPG brand.

Carol: That’s so cool. And you clearly have gone over and above and beyond, and built that amazing brand. And you’ve worked really hard, and we want to jump way more into the specifics of that. But first, we really want to jump into your story. So, where did you, where did Nik Ingersoll start his entrepreneurial adventure? When did you realize you had that entrepreneurial itch? And what were some of the successes and failures along the way?

Nik: So, I grew up in a very rural part of western Nebraska. And to give you an idea of how isolated that was, to get there you have to fly into Denver, then drive across two state capitals, four hours, to eventually arrive at sort of where I grew up.

Nik: And so, there wasn’t a ton of opportunity. There wasn’t a lot of … I live in LA now, and you drive around, and even if you live in a bad neighborhood, which I’ve lived in a lot, you still can drive to the nice neighborhoods and look up and you’re like, “Oh, there’s all this opportunity and stuff, and there’s people who went to college and there’s things happening.”

Nik: Where, where I was at, it was just … First of all, I didn’t live in a town, let alone near anybody like that. And so, it was a very isolated place, and so in large part, what I can credit to being where I am today is the advent of the internet.

Nik: My generation was one of the very first ones ever to grow up with access to the internet. Things like MySpace and buddypic.com. Shout out to buddypic.com. I don’t know if that’s a thing anymore. AIM, and all these things. And connecting with people that are in new and different places that you just wouldn’t know them. You wouldn’t know anything about it. You didn’t have the research and access to information, and so I was able to sort of look up, “Hey, what does California look like? How do I get there? What do different colleges need?”

Nik: And so, growing up like that, we grew up on government assistance and grew up pretty rough around the edges. We didn’t have any money or anything like that. And so, in my mind it was like, “Okay. You need to start hustling every single moment that you got.” So I’m out there shaving sheep. I’m baling hay, you know? I’m delivering papers.

Nik: Eventually when I was able to drive, when I was 14, I would drive into town and go work at the cash register at Target, and all kinds of just crazy, random stuff. I’d be mopping floors. I’d do whatever I could do as a side hustle just to get cash, because there was no cash.

Nik: And even in school, maybe the first memory of mine at least is, this is elementary school and I would … You’re not supposed to have gum, because kids are pretty irresponsible when it comes to their gum habits, myself included.

Nik: And so, since there wasn’t any gum available, I’m like, “Wow. There’s a lot of demand and no supply of gum.” And so, I decided to start my own little gum retail company in elementary school where I had this little case, and I printed out this little label that I designed on Word or Paint or whatever it was at the time, and started selling that. And I think that was the first thing that really sparked it.

J: That’s awesome. So, just to give a little context because a lot of our listeners aren’t watching this. They’re just listening to it, and they can’t see approximately how old you are. But I know for a fact that, just a couple years ago, you were selected to the Forbes 30 under 30. So, as of a couple years ago at least, you were under 30. How old are you right now?

Nik: I’m the big 3-0 now.

J: Ah, congratulations.

Carol: Wow, you made it to 30. Woohoo.

Nik: One step closer, you know?

Carol: That’s amazing. But it sounds like you’ve been hustling since … You’ve been doing all kinds of stuff to earn money and just figuring out what opportunities there were pretty much your whole life, right? I mean, I would suspect … You’re talking about shaving sheep and baling hay, doing all those things, so you’ve been doing this forever. You just realized you needed a better life and you were just going to make it happen?

Nik: Yeah. I mean, there really was no other choice for me, at least not the way that I saw it and continue to see it. And I do think that that general background that I grew up with sort of fuels even my daily activities today. Sort of like this subliminal fear of being poor, and all of that.

Nik: When I was in high school, I did a lot of acrylic and oil paintings, and so I would go and I’d start selling those at galleries, which was much more glamorous than baling hay or branding cattle and doing all that kind of stuff.

Nik: So that was a way cooler side hustle. And then that eventually is where I ended up developing the design skills and eventually started designing logos and things of that nature. And so then, by the time that I got to college, that’s when I started a consultancy, eventually a small boutique interactive agency that then turned into an augmented reality company. We raised money and blah blah blah, and boom. Here we are.

J: Okay, so I want to unpack some of this. So, there was a whole lot in there. So, you started a marketing company, a design company. And you said interactive media company, an augmented reality company. There’s a whole lot there. What was kind of the transition? I mean, did you start a company and then decide, “I’m going to do something different”? Or did you start a company and say, “Oh, here’s an opportunity to morph it into something new”? I mean, were these separate companies, or was this just one company that kept morphing into new and new things?

Carol: Yeah, natural extensions and so on?

Nik: Yeah, it was kind of … They shape-shifted, for sure. So, I graduated high school. I went out to … I’d never been to California, by the way. I just was like, “Hey, there’s palm trees and Red Hot Chile Peppers music video. Yeah, that seems like a good spot.” So I ended up there to go to college, and my way out of these was always get straight As.

Nik: And I hear a lot in entrepreneurship like, “Oh, you don’t need to to go to school, man. Just flunk out. It’s so cool.” But also, like …

J: Yeah, Bill Gates dropped out of college, and Elon Musk dropped out of college. Everybody dropped out, but of course, they dropped out of Harvard and they got into Harvard in the first place, and yeah.

Nik: Super rich families, by the way. Opulent wealth running through their blood. So, a little bit different. But yeah, also, school can be a very useful tool, especially if you don’t live in a city, to get yourself out of poverty. And so, that’s the way that I saw it. Got straight As. Went out to California to go to college, and then that’s when I started doing all those things.

Nik: I was still painting. The problem with painting and selling things in galleries is, first of all, you’re purely reliant on ultra wealthy people to put an arbitrary value on your art, which is just weird.

Nik: And then, in addition to that, your return on time is terrible. You’re working for like, 80 cents an hour, because you really care about your paintings. And that’s when I figured out, “Oh, okay. Well, I’m just going to start designing packaging and logos and websites.” So I taught myself how to code and do all of that instead, which was far more lucrative.

Nik: And then, so the painting sort of morphed into that, which then eventually, I teamed up with this guy that was doing SEO. And at the time, SEO in, call it 2010, was like, so easy. You just … keyword stuff, all this stuff. So I teamed up with him. We would do a lot of local businesses and things. And then that company actually morphed into the augmented reality company.

J: Cool. And so, augmented reality. That means a lot of things that a lot of people. What specifically were you doing?

Nik: Yeah, so augmented reality is very interesting, because I even still today, that word really isn’t in the zeitgeist of our culture somehow. But very VR, virtual reality, is. So, you can think of AR and VR, they’re almost becoming synonymous, which is weird.

Nik: But the fundamental difference between VR and AR … So, VR, you have a headset on, right? And you’re totally immersed in a brand new world, right? “Oh, now I’m at Mars with Elon, tossing gold coins into the fountain,” or whatever you’re doing.

Nik: And in augmented reality, you have sort of a screen in which you’re looking through. It could be a goggles. That could be a phone. And you’re actually laying digital renderings on top of the real world around you. And you can do that through sort of a vector-based augmented reality platform, so essentially the camera’s reading the vector points of a certain object, so maybe it’s a chair.

Nik: And so every chair, you have your phone. You put it up to a chair, and it’s in camera mode, right? And then it sees a chair, and then maybe you have like a little elf dancing on the chair, doing a little jig. Something like that.

Nik: And then you could also do it geolocation-based, which is what we did. And so, you can go on a map and say, “Okay. At this exact block, I’m going to have two elves fighting to the death with swords.” And then you walk over to the block and then boom, there you see them fighting. And then if you look anywhere else, they’re not going to be there. So, that’s essentially what augmented reality is.

J: So this was basically the Pokemon Go craze from a couple years ago?

Nik: I’m telling you what, if I could go back in time, okay? And just know that all I had to do was put a Pikachu on the app, you know? Pikachu. That was the key to the whole thing.

Carol: That’s all you needed. That was all you needed. So, this is so fascinating. And so, now I’m just dying to know, how do you go from developing all that, having that as your business, and now you’re doing Barnana? What is the transition there? That’s just got to be such an interesting story. I’m dying to know what it is.

Nik: Yeah. It’s one of those things where, in my view, opportunity only comes around so often, and your ability to recognize opportunity both in your life, the situation that you’re in, and then also the market forces around you, is really what can allow things to happen in really profound and big ways.

Nik: And so, for me it was … I’m doing the Candy Lab thing. I’m doing augmented reality. And there were some problems in the business, and my co-founders and I didn’t see eye-to-eye. And that’s pretty common, right? That’s a normal thing and it’s fine.

Nik: So, I’d been working on Barnana actually at the same time that we were developing this augmented reality platform, and also going to school full time at this time. And so, this is all during undergrad. Hashtag absolutely no social life at all.

Nik: And so I’m doing that, and just trying to hustle and get by. I’m living in the ghetto, but I have a lot of hope and optimism for the future and all this, and I’m taking my part to create what that future could be.

Nik: And so, working on Barnana as a side hustle, working on Candy Lab as a side hustle. One of them started taking off, so I was doing that more disproportionately with my time. And that started to switch as my co-founders and I saw things a little bit differently. You know, Mike switching more time to Barnana. And then all of a sudden, natural foods back in 2012 is not what it is today.

Nik: Like, today you have massive acquisitions. We’re talking like, an 8-12x on top line revenue, multiple … for some of these exits of these smaller brands selling to people like Kellogg’s and Mondelez and Pepsi and all of that.

Nik: And so, it was one of those things where there was a big market demand for natural foods, and quite frankly, there just wasn’t that many brands out there. There was Sambazon. There was Kashi. A couple of those. But other than that, there was a real market opportunity and it was the right time for us to do it, and that’s kind of how that went.

J: Yeah, okay. But I feel like you skipped over a really important piece there, the thing that I’m most curious about. So, at some point you decided, “I’m going to start a business that requires me to source food products, to manufacture new food products, to package them, logo, manufacturing, marketing, sales, get into retailers.” This is a big undertaking. This isn’t kind of like, “Yeah, I’m going to go start a gum business in middle school, buying and reselling gum.”

J: So, how did you conceive of … because I’ll be honest. I’ve thought a whole lot about starting businesses over the years, and there aren’t too many business I probably haven’t thought about starting, but it’s never occurred to me that, “I’m going to go buy bananas and create banana snacks and get them into retailers.” I mean, that’s just a big undertaking. So, where did that come from? What started you down the road of, “I’m going to create a food business like this”?

Nik: I think at the very structural level, there’s too things. It’s naivete, and optimism. And those two forces combined can create some really amazing or terrible things, depending on how it goes. Fortunately for me, it was more the former than the latter.

Nik: But yeah, it was one of those things where it’s like, you know? Growing up, everybody always doubted me. It was like, “Oh, you can’t do this. You can’t move here. You can’t do this and that and whatever.”

Nik: And like, there’s so many outside forces just telling you, “Oh, you can’t do it.” And then, oftentimes what that manifests itself into, is then you start thinking that in your own head, right? And then you got that weird feedback loop that’s, “Oh, can I do this? Oh, I don’t know. I don’t know how to … What is sales? How do I get into Whole Foods?” Things of that nature.

Nik: And I just made a mental decision to not allow of that to enter my mind. Like, that’s just not a thing that happens anymore, right? And so, once that is released, it’s like, “You know what? I’ll figure it out. I’m just going to figure it out.”

Nik: And I think the “figure it out” mentality is the only reason why I got into it. Because, to be honest with you, the food business is brutal. It’s crazy. I mean, the margins are okay. They’re not great. They’re not software margins. They’re not service margins. They’re not cosmetic or supplement margins.

Nik: And by virtue of that, you’re going to have to raise more capital. You’re going to have to spend less on marketing. And sourcing, the way that we do it, we’re upcycling fruit from South America. You’re working with South American banana farmers and plantain farmers, and it’s a very crazy supply chain that we’ve built.

Nik: We’ve built really, really, really unique products, which is in part why the brand has done so well. But is also, and if you have asked my VP of operations, why our operations are so difficult. Because we chose to take the non-easy route.

Nik: So even within food, the fact that we’re organic even is cumbersome. It’s more expensive. It’s harder to source. Your options are limited. And then, to upcycle on top of that is pretty wild. But I think it’s just saying like, “It’s all good. I can do this. It’s fine.”

J: That’s awesome. Okay, so I still need to unpack more though, because I’m still … This is amazing to me.

Carol: So good. It’s so good.

J: Yeah, this is amazing to me. Okay. So, you decide you want to do a food business. What came first? The banana, or Barnana? Like, did you decide, “I want to start a banana business specifically. Let’s figure out a banana business to create”? Or did you decide, “I want to start a food business,” and then that led you towards bananas? What came first?

Nik: Yeah, so the thing that came first is the “Barnana” if you will, or the dehydrated banana. So my business partner, he grew up in Brazil and there’s all these dehydrated banana snacks. And they’re all over Brazil in sort of like, local markets. They’re wrapped up in cellophane, sold on street carts. They look weird. They’re sticky. They’re not a great eating experience, but they taste delicious.

Nik: And so, there were some brands down there doing … They would take the banana paste and they would wrap it up with sugar and bake it. Or they would make a little bar out of it. They would do all these different things.

Nik: And at the time, we were seeing things like acai come to the US and do super well, something like a Sambazon, right? And so acai, it’s been eaten in South America forever, especially in Brazil. Like, it’s just been served in sort of a bowl at a restaurant, that kind of thing.

Nik: And then, same thing with coconut water, right? Vita Coco and ZICO, they go down and take this idea of coconut water that’s been served all over Central and South America forever and also in southeast Asia. And no one had just thought to package this thing in a premium way and sell it in the US in supermarkets.

Nik: And so, that’s sort of the market opportunity that we saw. And it’s like, “Hm.” A little light bulb went off. It’s like, there might be something there, right? Taking these previously commoditized products that are very popular in these areas, and then packaging them in a premium way and selling them in new and different form factors. And so, I think that a large part of it was that.

Carol: Cool. So, you mentioned in there you had a business partner who grew up in Brazil and maybe other partners that were part of forming this right off the bat, right? So, tell us more. Who are those partners? How did you sync up with those partners, and have your roles changed? Or how did that all start at the beginning? Who are they? How’d you find them? And tell us more about how that all worked out.

Nik: Yeah. This one was pretty serendipitous. So, again, started this business when I was still in undergrad, and so I was also involved in a lot of associations and groups on campus, because I thought that was a good way to lead gen for my then service business of designing logos and websites and stuff.

Nik: And so, we threw an intern fare. So I put this intern fare together and there’s all these brands, and I’m like, “Okay. I’m going to go in all these booths. They’re looking for interns. I’m looking for clients.”

Nik: So I go in there thinking, “Oh, yeah. I’m going to find some people to make logos for and stuff.” Then I might my now business partner, Caue. And so, he had a bicycle manufacturing company at the time. I was like, “Oh, this is a perfect target, right? Smaller business. It’s not Black & Decker or one of these giant businesses that are there.”

Nik: And so, we became friends. And then, through the course of getting to know him and talking to him more, the bicycle thing just kind of wasn’t a fit, I think, that his focus was sort of turning off of that. Maybe he was thinking about winding down the business. That sort of thing.

Nik: And so, it sort of transitioned into this, “Hey, there’s also this thing from Brazil and there’s these dehydrated bananas and this and that. I’ve been thinking about this.” And then, that’s sort of how that whole thing sparked. And our third partner, Matt, I went to undergrad with him at San Diego State, and so in a very strange way, Matt was working for Caue’s roommate at the time, actually. And that’s how we all three came together.

Nik: And like I said, we worked on this actually as a side hustle for probably almost two years. Like, the better part of a year and a half, at least. And then eventually said, “Let’s just launch this thing at Expo West,” which is the biggest natural foods products expo in the world.

J: So, okay. This is great, and one of the things … I have so many questions here. I feel like I could ask for the next four hours. But here’s one of the cool things about starting a business: It never ends up being what you originally envisioned it being. So, this was 2012, I believe I read, that you started Barnana?

Nik: Yup.

J: So, most likely over the past seven years, things have changed from your original vision. And I’m sure we’ll get there, but I’m curious, what was the original vision for the company? What kind of products did you envision that you’d be making? Where did you envision you’d be selling them? Who were your customers going to be? And then I’d love to talk through, as we go through this conversation, how that’s changed, if it’s changed, over the last seven years.

Nik: Yeah, it’s definitely changed. I mean, in the early stage, it’s like, you just want to make something that’s sexy, pretty much. Right? You want to make something that looks great and hopefully … especially if you’re in food, has to taste great, by the way. A lot of people nowadays have, things have changed. People make food that tastes terrible now and expect it to sell, which is a whole different story.

Nik: But, yeah. You got to make something that looks sexy early on. You got to attract investors, because the fact of the matter is, if you want to scale, at retail, a food business, you’re going to have to raise money. There just are no two ways about it, unless you come with some Jeff Bezos family money style financial backing.

Nik: So, you have to prepare yourself for that. And in the early stages, it’s just a lot of that. It’s being scrappy. What we saw was, we wanted to be the brand synonymous with banana-based snacks. Bananas sell more than apples and oranges combined in terms of tonnage in the US, which is insane.

Nik: And when we were looking at the coconut water and the acai equivalents, nobody even knows what that is. People in Michigan or wherever, Nebraska, call it, don’t even know how to pronounce “acai” still today.

Nik: And so, everybody eats bananas. Everybody’s familiar with bananas. And so, we just saw that we had such a clear path to have our brand be able to connect with people in a more meaningful way, just intuitively, with things that they already eat.

Nik: So that was the original plan, and since then, we’ve also expanded out into plantains, which kind of came out of left field. Plantains are a cooking banana. And we were like, “Well, that still fits within our vision.”

Nik: And when we started the company, we knew we wanted to be a sustainable brand. We knew that we wanted to be organic, and we’ve really stuck true to those values. So in terms of the basic structure of the business and the mission vision value stuff, it hasn’t changed much at all.

Nik: The market has changed a ton, which I was talking about earlier, with the food that tastes bad. A lot of people now, the upcycling thing was something that we started very early. And it was something that we just thought was the right and sustainable thing to do for the food supply. It was something we discovered, actually, as we were sourcing bananas.

Nik: And now, the “mission” of brands is very important. And for good reason of course, right? Brand storytelling and the rest. But what ends up happening, one negative externality at least that I see in the way the market’s changed since we started, is now people are making food that tastes so bad. But they have a really cool mission, and they’re just banking on that. And that might work at Whole Foods and some of these more natural accounts, but that’s definitely not going to work at scale.

Carol: Got it.

J: So, we’re talking about the taste of food, which leads us into the discussion of … Well, first I want to hear about what a couple of your products are, because I know you have a whole bunch of products. But how are you sourcing your … I guess we can call them raw materials, your bananas.

J: How did you find the source of your bananas? Who’s doing the manufacturing? Who’s actually creating the product for you? And what does that process look like, of actually getting bananas imported to the country, assuming you’re getting them from outside the country, and actually getting them packaged and on the shelves? What does that whole process look like?

Nik: Strap yourself in. Our supply chain is super crazy. So, I’ll start with the bananas. So, the bananas that we use are upcycled, meaning that they would normally go to waste. So, when people think of waste bananas or bad bananas, they think of the black bananas that are sitting on their kitchen that fruit flies are around and all that. That’s not what we use.

Nik: We use bananas that are still green. In fact, we have to ripen them before we can dehydrate them and then import them to the United States. And so, what food waste looks like on a banana farm is the bananas are too big, too small. They got a bump or a bruise or a scratch or a something, where they’ll be rejected for export to either the EU or to the US.

Nik: So, that’s what upcycled bananas actually are. And so, about 20% of all the bananas that grown go to waste before they even reach the boat to get shipped off to wherever. And in places like Ecuador, Honduras, Guatemala, these places, they export up to 80% of all the bananas that they grow, because their populations are super small. Their banana farming is massive, and the demand in other places like the US and the EU is super high.

Nik: And so, we use those bananas. We dehydrate them in South America, and then we put those on a boat into massive containers, take them into the US, and we do all the final processing here. So that would be covering them in chocolate or peanut butter, mixing them with coconut, or mixing them with other sorts of fruits, and then of course, packaging them and all of that.

Nik: Now, the plantains are a fundamentally different supply chain, actually. So, the plantains, which is really crazy … So, last July I was in the Amazon rainforest. Our plantain chips come from these indigenous farming tribes in the middle of the Amazon, a very remote part of the Amazon.

Nik: And so, there’s not a lot of organic plantains. We had to sort of build this trail in the supply chain, because there just wasn’t one that existed, which is kind of crazy, which is very unlikely the bananas.

Nik: So, we’re actually going in to each individual village of, maybe it’s a community of 50, 100, 150 people, 20 people, up and down the Amazon river basin, and saying, “Hey. We know you’re growing plantain for the shade, for cacao, and for use in these other things. Can we get these farm-certified organic? We’ll help you do it. We’ll foot the bill. We’ll do the whole thing.” And then get those things turned around, put those plantains into a truck, have them trucked over to the city and have them peeled, cut, fried, put into a container, sent to the US, and then packaged.

Nik: And so, that was a really crazy experience. You know, this is something where you go into the Amazon rainforest, and I speak Spanish but they don’t speak Spanish. They speak the native tongue of Kichwa, right? And so, I’m speaking to an interpreter that’s then speaking to them in Kichwa, and we’re doing these town halls. And they’ve never seen anybody that doesn’t look exactly like them, that also lives in the Amazon. And so, it was a super special experience. And also, cool to see how we can impact positive economic growth in those areas.

Carol: Nik, my mind is so massively blown right now. I don’t even know where to begin. So, wow. Okay, so how do you even get a connection … Okay, so you’re talking about how this all grew organically and things just kind of happened as you made them happen. But I don’t know how you organically, for example, have a connection that’s leading you to these indigenous tribes in the Amazon rainforest when their native tongue is Kichwa and et cetera.

Carol: Like, how did you even go about saying, “Oh, we need to go source some indigenous tribes in the Amazon rainforest and hold these town hall meetings”? How does your mind even get there to realize that is the key to sourcing what you need for your business?

Nik: Yeah. I mean, sometimes you just don’t know what you don’t know. Like the ignorance is bliss, the naivete thing that I was talking about earlier. So we’re like, “Oh, yeah. Well, people eat plantains and there’s like, fried plantains all over the place in Puerto Rico and Cuba, everywhere. And so, there’s got to be organic ones, right?”

Nik: No. There wasn’t. And so, we’re like, “Uh oh. What are we going to do? We said everything that we’re going to make is organic, and so now we have some work to do.” And so, we essentially contacted our partners in South America that were already doing the bananas and just started doing digging, and finding fixers here and there and intros and sort of this long chain of introductions to eventually end up at that place.

Nik: And they had a very, very small production of organic plantains. We’re like, “Okay. Well, can we expand that? How can we?” And so now, it turned into, “Yeah, we’re going literally village to village to expand the supply chain as the brand grows here state-side.”

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J: So, just out of curiosity, because you’ve used the term “organic” a number of times, and I know everybody gets confused and has a different definition of organic. So you said, “There’s no organic plantains.” What is “organic”? What is the definition of “organic” that you’re working off of when you say there are no organic plantains out there?

Nik: Thank you so much for bringing that up. Totally remiss because I’m in the industry, so you’re in your bubble. That’s actually a great thing to bring up. So, a lot of people don’t know what “organic” is.

Nik: So, what “organic” is, it’s USDA certification. So, when you’re getting food … Food is largely unregulated, by the way. A lot of people also don’t know this. The majority of the food that you’re consuming, no one’s checking the nutrition label, okay? No one’s checking the ingredient statement at all, unless you are certified organic. Then they’re going to check your ingredient statement.

Nik: So, that’s one of the parts of the NOP, or the National Organic Program, that the USDA has. So, being organic is a USDA certification, where people are going to the farms, seeing what kind of things are getting put, sprayed into the dirt, onto the plants, that whole thing, certifying the supply chain.

Nik: And you have to do audits throughout the year, and get re-certified every single year. And, what people often think is like, “Oh, well, you just throw some seeds in the dirt and that must be organic, right?” And it’s not, because you could still spray that with Roundup. You could spray that with any number of herbicides, pesticides, et cetera. And then depending on what you’re growing, some of those herbicides and pesticides can get into the food, and also create some runoff, some agricultural runoff.

Nik: I grew up, again, in a very rural part of Nebraska, where when I was a little kid, I’d go outside, and there’s like these airplanes like … and I’d be like, “Oh, Dad, they’re watering the plants!” He comes out and he’s like, “That’s not water! Don’t get under that!”

Carol: “They’re poisoning the plants!”

Nik: Yeah. So, there’s a very high water table there, right? And so there’s some seepage into the water and all these things. And so, that’s why we made the decision to say, “We’re going to be USDA-certified organic, instead of just relying on the natural claims that some other brands tend to do.”

Carol: Cool. So, it sounds like to have this USDA-certified organic company … and you’re talking with … So, you’re multinational, right? You have such a capital-intensive business, to be able to accomplish all those things. You’re sourcing from overseas. You’ve got all this importing. You’ve got the production. You’ve got the packaging. You’ve got the sales. You’ve got all the branding, all of these things.

Carol: And it sounds like, you mentioned you came from nothing in Nebraska, and you had Caue and Matt as your partners. Where did the money come from? So, you had to have some financing at some point. How did that all come into fruition?

Nik: This is a crazy story, actually. And this just sort of shows how, when you’re prepared for something and an opportunity comes along, you’re ready to execute. So again, we were working on this thing as a side business. And all we really had was the branding that I designed. So I designed all of the packaging and branding all of that personally.

Nik: And so, we had something that looked legit. And we’d been working on it for a while, and it’s like, “Ah, this Expo West thing’s coming up,” which is the big expo for natural foods. Like, “Well, maybe we should just go? Let’s just get a booth, right, and just put the branding up. Looks legit, and just see what happens.”

Nik: So we did that, and upon doing that, we had Whole Foods and Wegmans come by. Wegmans is a big east coast retailer. Everybody knows Whole Foods. And they’re like, “This is great. We want to take it.”

Carol: Wow.

Nik: And we’re like, “Uh, good. Good. Yeah, yeah. We’re ready. We’re ready.” And we’d never made a production run, right? We just had a little bit of samples. I went to FedEx and printed some stickers out, put them on packages and put them in a glass case, so no one could feel how not-legit they are. But they looked great under a glass case.

Nik: And so, when they came with a PO, it was like, “Oh, dang. We got something here,” you know? And we essentially took those POs after Expo West, and went out and raised capital based on that.

Nik: So that’s how we first got money into the business, so we raised sort of a seed round, with 100% warrant coverage to give some investors some further confidence that they’ll be able to reinvest in the company at the previous valuation if the company’s doing well, which is a nicety for them, and sort of went from there.

J: I love this. Okay, so this reminds me. Back about six weeks ago, we had a guy on the show named Alan Donegan, who teaches basically how to start businesses with little risk, little capital, and basically this is right out of his playbook. And a lot of entrepreneurs take this playbook where they want to reduce their risk. They want to reduce their upfront capital expenditures, and so what you did was, you created a brand.

J: You … I don’t want to say faked a product, but you faked a product, and you put it out there to see what kind of response you got, and you literally started getting orders before you started spending money on sourcing, production, manufacturing, packaging. You literally proved out your model, before you had to spend any money.

J: And that is absolutely brilliant, and I think that’s just a great reminder to our listeners that starting a business, even a business that seems so ridiculously capital-intensive, and so risky, there are ways if you’re creative that you can do that with a much lower risk and a whole lot less money.

Nik: Yeah, I think that’s a great point. That’s exactly what we did. We definitely made a brand that looked awesome, but wasn’t legit. It looked legit. But we didn’t have product to send anybody, you know? And that’s true. Also, for me at the time, I didn’t have any money. I’m living in the hood. I’m commuting to La Jolla to work with Matt and Caue, because that’s where Caue’s roommate’s office was and all this.

Nik: So it was a really weird dichotomy, going from where I was living to then drive over to, essentially, the Beverly Hills of San Diego, if you will. And so, by virtue of just literally not having a dollar to my name or to my family’s name, period, there really was no other option either. Right? I didn’t have 20 grand to just go spend on a production run. It just wasn’t an option.

J: Okay, so now you’ve got your first order from Whole Foods. You do your production run. Presumably, you get the product in Whole Foods. How did that go? How was the reception there, and how did you expand from there? What were the next big retailers, or the next big marketing channels?

Nik: Yeah. The reception was great. When you’re launching a food brand, it’s very important to keep in mind channel strategy first. So by “channel strategy” I mean, there’s certain channels of retail. So you have sort of your natural channel, if you will, which is Whole Foods and the like. You have your big box, which is your Wal-Mart and the like. You have club, which is more like Costco. Convenience, which is a Shell station or a 7-11.

Nik: And so, you want to be really, really mindful of what your channel strategy is, because that’s what all of your activities and dollars are going to map to. And so, we decided the very first channel we’re going to go after is the natural channel. It just made intuitive sense for us.

Nik: So, we expanded in Whole Foods. We started out in a couple of regions, quickly expanded into the rest of the regions in the country, went global, and also went into all the small mom and pop infra accounts.

Nik: Also in the food space, there’s a very important piece of this that a lot of people don’t realize, and that’s brokers. And it’s one of those necessary evils. They’re not evil. They’re great. Shout out to all the brokers out there. But it’s evil for your P&L, right? Because there’s money getting drained out.

J: Evil for your margins.

Nik: There you go, yeah. But the great thing about them is that they have pre-existing relationships with all, especially these smaller retailers. Like, have you ever heard of Nugget Market? Well, if you’re not in the Sacramento area, you probably haven’t. But it’s a great, great market. And they have 13 stores that sell a lot of product, but if you don’t have these brokers all over the country, there’s just no way for you to know that.

Nik: There’s no way for you to create those relationships with the buyers, because the buyers have a limited amount of time. They have thousands and thousands of SCUs in each store, and they’re not going to meet with each individual brand all the time, especially ones that aren’t even in there. That’s not just going to happen.

Nik: And so, plugging into a broker network is a decision that we made really early on. One of the brokers that we worked with actually made a cash investment in the business, so that was in addition to just sort of having a brokerage network, that also helped us out in terms of raising capital and giving confidence in the business, and giving us confidence in what we’re doing.

Nik: If we’re getting money from somebody like that, who’s seeing the likes of Cliff Bar and all these other giant brands, then we must be doing something right, right? At least, that’s what we thought back then.

Nik: And so, yeah. That’s channel strategy first, and then expand from there. So you want to have, this is our first target, second target, third target. From Whole Foods, now we’re in places like Wal-Mart, like Costco, things of that nature. But it’s all been very sequential, year over year.

Carol: I really appreciate you breaking down those different channels. It’s interesting. I’ve done a lot of different product development to lots of different things along the way, but I’ve never been specifically in the food space, and there was a big light bulb moment for me there, right? Because of course, you think of your different listeners, your different audiences, your different markets, your different demographics, of all of those.

Carol: But just … I think that’s a really interesting tip for our listeners. Whatever kind of product it is, if you’re in a food business or if you’re in some type of entertainment product or whatever it is, to look at those specific channels, like breaking down the convenience versus the club versus the health, versus the general grocery. That type of thing, I think puts you in a really interesting, different and focused mindset to get you where you need to go, right? So, thank you for breaking that down.

J: Yeah, it’s kind of like, you don’t go after the shotgun approach. We don’t want to be all things to all people. We want to define what our brand is, and really target the customer demographic that wants that brand. And I think that’s a mistake that a lot of business owners make.

J: They say, “Yeah, everybody in the world’s going to love my product, and I’m going to sell it. I’m going to have seven billion customers out there, because everybody’s going to want our product for some reason.” When in reality, you need to connect with a very specific subset of that customer demographic, and really serve them specifically.

Nik: That’s exactly right. The shotgun approach … and I’ve seen some epic failures. I mean, crazy epic failures from doing exactly what you just said. They’re like, “Everybody’s going to love my product. Don’t worry about it.” And then they go to, call it, 12, 15,000 retailers in less than a year. And sure, the open orders are great.

Nik: And then you get no repeat, and then you’re getting discontinued the very next year, because you didn’t build that core audience in one area. And also, you spread out all of your trade dollars, your marketing dollars, all of the rest of it, your brokerage dollars to different brokers for each channel, and then that story usually doesn’t go well.

J: That’s great. So, you’re the CMO, the chief marketing officer, for Barnana. So, you’re the guy to talk to about the marketing strategy. How did you come up with your brand, your marketing? How did you decide on, I guess, what we were just talking about, who your target buyer, customer demographic was going to be? How did you come up with that?

Nik: Yeah, so with us, it’s one of those cases that I think a lot of people find themselves in, right? Because everybody, in theory, is a consumer of your product. It’s a chocolate-covered banana. It’s a plantain chip. Who’s not going to want to eat that? But that’s also the pitfall, right? Because you can’t be everything to everybody, and so you really do have to go after that core audience.

Nik: And again, that’s why channel strategy is so important, because you also know who is there. And so long as the channel also matches up with the target audience that you’re trying to reach, then everything is sort of aligned. And so, that’s essentially what we did.

Nik: And the way that we’ve marketed the product, from the very beginning, it was, “We’re going to do guerrilla marketing. We’re doing a lot of growth hacking.” Again, 2012. This was a lot of growth hacking online, which I had been doing for a long time. And then, growth hacking in the real world by doing crazy guerrilla marketing stunts that cost you $0.

Nik: Again, going back to having to constantly raise capital until you reach a certain inflection point where you become massively profitable in food, takes a long time. And so, the more things that you can do for free, the better.

Nik: And so, we would do things like, at Expo West the next year, I showed up with a blimp with a banana on it, and flew it around. Got it stuck in an AC vent. Terrible. Don’t get in an air balloon with me.

Nik: And then, I hired some professional break dancers. It was very cheap, for like an hour, to just go disrupt the very beginning of the show, and just make a scene. And they’re in banana and gorilla costumes, and everybody’s filming it. And then putting it on Instagram and on Snapchat and all of that. Things of that nature.

Nik: I launched a fictitious product called “Gorilla Milk.” If you go to gorillamilk.org, you can see what that looks like. I released a press release like, “Yeah, we were down in, milking eastern lowland gorillas with our own hands to get this paleo unhomogenized milk,” and stuff.

Carol: That’s hilarious.

Nik: And we really put it on, like it was a thing we were launching. And we’re getting inquiries from like, every single dairy publication you can possibly imagine.

Carol: Of course.

Nik: Yeah. And then also, a lot of angry vegan emails, which are hilarious. It was all sort of a PSA in the end to say, “Just because you can milk a gorilla, doesn’t mean that you should. And just because you can use pesticides doesn’t mean that you should.” And yeah, it took some of my time and thinking and things of that nature, but we didn’t pay a ton of media ad spend. It was just purely earned and things like that.

Nik: So, the more sort of guerrilla activities you can do … and I’ll just leave you with one more guerrilla activity, because it’s ridiculous and there’s just so many of them that we’ve done. So, the Ironman World Championships happen in Kona, Hawaii. And it’s this triathlon championship that happens every year.

Nik: And we didn’t have the money to just go buy the booth space and pay them for the sponsorship and all this BS. And so, what we decided to do was buy a giant, 20-foot-long banana, inflatable banana, with our logo on it. And then wake up really early in the morning, and then swim it into the bay with a brick on the bottom, and then anchor it in the bay where everybody swims in the morning.

Carol: That’s hilarious.

Nik: So we just have a giant banana billboard in the middle of the ocean, where all of our target consumers are, everything else. And we didn’t have to pay anything. Of course, after a couple of days, somebody else swam out there and popped it and took it away, but …

Carol: But it was there.

Nik: It was well worth the spend.

Carol: A 20-foot-long inflatable banana. I mean, is that right on Amazon? Where does one go to find a 20-foot-long inflatable banana?

J: Ali Baba;.

Carol: This is so cool. I love the ingenuity and the creativity every step of the way. You just don’t stop. The ideas just keep going and building your brand, and you’re just out there in front of everybody. It’s awesome.

Nik: Yeah. It’s a way to keep things fun, too.

J: Awesome.

Carol: Absolutely. Really fun.

J: Yeah. So, can I jump into the numbers a little bit? A lot of our listeners are really intrigued by numbers for different businesses. We know every business is different, so can you tell us a little bit about … so, the cost structure. And you don’t have to go into tremendous detail, but what do the margins look like in your food service business, maybe compared to general food service businesses?

J: Where’s the bulk of your cost coming from? Is it the sourcing of the bananas? Is it the manufacturing into your final product? Is it the packaging? You mentioned that you have a broker, so presumably you have wholesale channels, which is eating up a lot of costs and reducing your margins. Can you take us through just a little bit, the numbers of producing the product and selling the product that you have?

Nik: Definitely. So, I’ll start from the bottom up, actually. I think that’s probably the most helpful. So, if you’re looking at your P&L would be going from the very top of that P&L down, and so, start with product margin. Just straight up product margin. So, what are you selling it for, minus your cost of goods sold?

Nik: In the food space, that number’s going to be somewhere between 45 and 65% on average. And so, if you’re batting anywhere between that range, early on especially, towards the lower end, then with scale, it’s likely that you’ll get a better margin in the future.

Nik: But if you’re under that range, it’s going to get a little hairy. It’s going to be hard to raise capital. You’re going to have a lot of questions. The scalability is going to come into question. All those sorts of things.

Nik: And so, you definitely want to be within that sort of 45-65% range. Now, 65 is very high, especially in food. And so, our business, we have very good margins. Well, for the industry, of course. Not software margins. But-

J: So, let me interrupt you really quick, just so I can clarify for our listeners that may not be familiar with some of these terms. So, what you’re talking about are gross margins, which means for every dollar that you bring in, people buy a dollar worth of your product. It’s costing you between 45 cents and … I’m sorry. You’re earning between 45 cents and 65 cents in profit on the cost of that product.

J: That doesn’t include all of your overhead costs, like if you have an office space or paying employees and stuff like that. That’s strictly 45-65 cents of every dollar you make, is what you keep from the product sale or from the product development, and then after that, you then pay all of your overhead expenses as well. Which again, reduces your profit as well. Correct?

Nik: That’s right.

J: Okay.

Nik: Yeah, so essentially, you can look at it this way. You have your product margin. Down from there, you’re going to have your gross margin. From there, you’re going to have … You can call it your contribution margin, and you’re eventually going to have your net income margin, right? And so, product margin, maybe your cost of goods sold is $1, and then you sell it for $2.35 to a distributor.

Nik: And then the distributor’s going to take somewhere … and distributors vary highly, but they’re going to take somewhere between, call it, 7-30%. 30% would be a DSD, somebody who’s a small distributor that goes into the store and actually builds displays and things.

Nik: And then the 7-15% range is more like your glorified trucking companies that just pick your stuff up and deliver it to places like Whole Foods. And so, then they actually take ownership of the product, right? And they sell it to Whole Foods.

Nik: And so, you’re not going direct. You go direct to some retailers, but oftentimes there’s a distributor intermediary that you’re actually selling to. And then, once you get to a Whole Foods or a name your retailer, they’re going to take a 42-50% margin generally. So, you end up with a product that’s $5.

Nik: So, something that costs you $1, sold it to the distributor for, call it, $2, $2.50. Something in that range. And then, the end consumer’s going to end up buying it for $5. So you can see how that scales in retail very quickly.

Nik: So the biggest cost you’re ever going to have is the retailer’s margin. And so, that’s why you have to front load that product margin as much as possible. And then, the way you’re building your P&L, you got your product margin, and then to get to your gross margin, you’re going to have to factor things in like trade spend.

Nik: So, at retail, you are required to have trade spend. Which essentially means when you go into, name your favorite retailer, and you see “two for seven” or “20% off” or whatever, the brands are funding all of that. The retailer’s not funding a dime.

Nik: And so, about 15% is pretty standard. 15-20%, depending on the product category, is what you would expect to spend in trade spend. And so, once you have your product margin, you have to take, call it, 15-20% out for trade spend. Then, you end up with your gross margin. And then underneath your gross margin, you’re going to hit all of your standard expenses, your SG&A, all that kind of thing, to actually get to your net income.

J: Awesome, okay.

Carol: Great breakdown.

J: And so, if you had to talk about your operating margins, your net income margins, what are we looking at here? 5-10%?

Nik: Well, it depends at what scale you’re at, right? Because if you’re growing really fast, then you’re going to need to be hiring people before you need them, right? Because you can’t sort of scale and try to back hire. That’s just not how it works.

Nik: And so, there’s a lot of upfront costs that you have to foot before you can actually reach the revenues that you want. So, it’s a bit of a cat and mouse game, really. And you don’t really see operating leverage in food businesses until you’re hitting, like break even for a really fast-growing food business? Somewhere in the $25 to $35 million top line revenue range is where you’re going to start getting positive net income.

J: And that’s really interesting. I think that’s what a lot of business owners fail to see, is that you hear about a company like Wal-Mart that’s living on 1 or 2 or 3% margins, but they weren’t doing that. If they were operating at a tenth of scale, they’d be losing a ton of money. So, you need to get to a certain scale before your margins really are optimized, and you’re making the most money. And that can take, I assume for you, it took years.

Nik: Yeah, well said. Well said. On the Wal-Mart piece, I think that’s a very fitting corollary. And yeah, it does. It takes a lot of years, and it depends on how fast you want to scale, you know? You have to scale right. We talked about the shotgun approach earlier, and it’s really a factor of that. What’s the risk tolerance? What’s the market opportunity, and when do you think you can find that leverage?

Nik: And oftentimes too, you’ll see these brands … and to call out a couple very successful ones that were acquired recently, KRAVE Jerky or RXBAR, they were acquired for hundreds of millions of dollars, and they were also not profitable, right? Until they reached that scale range, in terms of revenue.

Carol: So, talk about scaling. Talking about market opportunity, what is it that’s next for Barnana? What’s coming up?

Nik: So, we’re working on something super exciting.

Carol: Ooh.

J: Oh, are you going to announce it here? Or do we have to wait?

Nik: It’s a secret.

J: Okay.

Carol: Aw, darn.

Nik: I know, I know. It really is. So first of all, tastes delicious. It will be my … probably top two, one or two, position in my favorite products that we make. And you’ll be seeing it probably around, call it, March, I want to say, for the very first time.

Carol: Fantastic.

J: Okay.

Carol: Six months out from new super secret, awesome product. Can’t wait.

J: I’ll make sure you have our address so that we can see it in maybe February.

Carol: There you go, there you go.

Nik: Absolutely.

Carol: Okay, fine. That’s a secret. We can live with that. But what is next for Nik Ingersoll? You’ve got so many cool things in the works. What is next for you?

Nik: Yeah, I’m just going to keep doing my thing, you know? Continue to build the Barnana brand. Continue to work on side hustle projects in my spare time, because that’s just what I like to do. Keep doing my own podcast, and hopefully helping people in the future. All these things that I’ve had to learn firsthand are tough, and there really is no other way to learn from.

Nik: And for anybody listening to this podcast that’s thinking about launching a food brand, I very much hope that this was very insightful and helpful because there wasn’t a resource like that out there for me, and I think that that’s … If you have something that you can give out for free that gives a lot of people a lot of value, then you should do it. And so, that’s what I’m going to continue to do.

J: That’s awesome. And, does it concern you at all that you’re on this podcast and you’ve given away all your secrets? And now all of our listeners are going to run out, they’re going to fly to the Amazon. They’re going to start sourcing their own organic plantains and bananas. They’re going to meet with these indigenous tribes. I mean, you’ve basically given away the keys to the castle.

J: So that does lead me to my last question here, and then I want to jump into the next segment of the show. But before we get to the final segment of the show, I do have one more question. For anybody that’s out there that is thinking about starting a food business, a food production business, and it doesn’t necessarily have to be bananas. It doesn’t necessarily have to be imported. But for somebody that wants to get into food production and retail, what’s your best piece of advice?

Nik: So, if you’re looking at retail, just know you’re going to have to raise money to scale. It’s impossible to do so without raising capital. I would also say, start online. If you don’t have a native background in direct-to-consumer or Amazon, either one of those two channels are great. I would recommend doing both. Oftentimes, people will be like, “Oh, but Amazon cheapens my brand and I’m scared.”

Nik: And on the other side, it’s like, people make just Amazon-only brands that aren’t brands. They’re just products. And so, don’t do either of those things. Make an awesome brand that can be DTC, and also be sold on Amazon.

Nik: And that will allow for you to not have to pay for that 42% margin that somebody like Whole Foods or Target or whoever is going to take from you. So, start there. When you think about going into retail, be so, so, so mindful of your channel strategy. Make something that tastes delicious and looks awesome, and good luck.

Carol: Thank you. That was great. Great advice. Okay. With that, Nik, let’s go into the final segment of our show, that is called the Four More. Okay, so these are four questions, plus a more question, that we ask all of our guests. And we’re going to throw them at you, rapid fire style. Okay? Can you handle it?

Nik: Love it.

J: Okay. It’s not really-

Carol: Okay. J, you take the first one. What?

J: It’s not really going to be rapid fire. I mean, we both speak a lot more slowly than he does, so …

Carol: Totally. We’ll step it up to turtle pace for you.

J: So, Nik. What was your first or your worst job ever, and what lessons did you take from it?

Nik: Ooh, worst job … I’ve had so many bad jobs. Or every job is a great job, depending on your perspective. I think every job that I’ve had is a great job, but the worst great job I’ve ever had was making sandwiches at Subway. Living in the ghetto, and then driving to this opulent neighborhood to go make sandwiches for rich people, and then just having them look at me like I’m the scum of the earth, and like this weird kind of … Ugh.

Nik: And you smelled like the bread. You know, you walk into a Subway and you smell that bread? Your whole existence smells like that. So that was probably the worst one for a lot of reasons.

J: So, I know this isn’t about me, but I just have to throw out. My very first job, and probably also my worst job, was I worked at country club making sandwiches for golfers on the 19th hole. And let me tell you something. I walked out of that job hating golfers. For years, I used to talk about how I hated golfers.

J: Then I started playing golf, and I don’t really hate golfers anymore. But, yeah. Yeah. I know when you’re young, and you’re catering to wealthy people who don’t necessarily respect or appreciate what you’re doing, that can be tough.

Nik: That is exactly what that is. That is hilarious.

J: And that’s why, as we get more successful, we treat everybody well.

Carol: Absolutely, and then some.

Nik: Well, you never know who’s making your damn sandwich. Just remember that.

Carol: Exactly. You never know. Okay, Nik. What’s an opportunity along the way that you’ve said no to? And do you think it was the right decision?

Nik: Opportunities I’ve said no to. So, one of the bigger ones that come to mind … So, when I was in high school I played in a metal band. I wouldn’t even call us moderately successful at it, but there was a lot of interest from some record labels at the time in the Denver area.

Nik: And so, around the time I was graduating high school and I had this master plan of going to California to go to college and all these things, and I’d been a musician my whole life. And so, I just loved playing death metal on stage. It was like, the most kinetic type of live music ever.

Nik: And it was really fun. And I had this opportunity to go and do that, and pursue the record label route and the touring and all the stuff. And I decided not to do that. That was an opportunity that I turned down, because I had seen a couple of people that were older than me that took that route, and they had a great time on tour and sold out shows and all the stuff.

Nik: But they never made money. All their stuff was paid for, but they were never really making money. And oftentimes, that turns into, you just keep doing the same thing over and over. Unless you become a Slayer or one of these types of guys, it’s going to be a rougher route. So that was one of the bigger opportunities that I said no to really early on, actually.

J: So, Slayer or Billy Joel. You know Billy Joel’s first band was … I’m a big Billy Joel fan. His first band was a heavy metal band called a Attila.

Nik: Oh, I know Attila. Yeah. What? Billy Joel was in Attila? What?

J: Billy Joel was in Attila back in the early ’70s.

Nik: What? That’s awesome.

Carol: It’s just wack. That is just not even normal.

Nik: Billy Joel. Wow.

J: Okay. So, question number three of our Four More. If you could go back in time, what advice would you give yourself before starting Barnana?

Nik: Yeah, so if I was going back in time … So I’m in my Bill and Ted Excellent Adventure movie of my life.

J: Yup. Yup, hop in the phone booth.

Nik: Pop into the elevator. Phone booth, yup. Shows you how much I remember that movie. Pop into the phone booth … I thought it was an elevator.

J: Oh, it might have been. Yeah. I don’t … I’m old.

Nik: No, you’re right.

J: My mind’s going.

Nik: And I get in there and I find myself, I’d just give myself a straight up pump up speech. I’d be like, “Dude. Don’t listen to anybody, okay? And just do your thing. Keep going. Just keep doing it. Be happy. And if you grind hard enough and work hard enough, then you’ll get to where you want to go.” That’s what I would do.

Carol: That is awesome. I want to repeat that. “If you grind hard enough and you work hard enough, you’re going to get where you want to go.” That was very powerfully said. Thank you. Okay. One last question of our Four More, which is: Nik, what is something along the way that you’ve splurged on, that was totally worth it?

Nik: Splurge.

Carol: Splurge.

Nik: “Splurge.” I like that word. What have I splurged on? What have I splurged on? Oh, man. I don’t splurge on much, to be honest with you. But I guess one thing that I splurged on was a bed. Like, a legit bed. Forever, I was on this bed for like … I don’t know. It was like, this used mattress that I got from somebody else that used it for 10 years. Then I was sleeping on the damn thing, and it’s super not good for sleep and stuff.

Carol: Totally defeated the purpose.

J: That’s how you know you’ve arrived. You now sleep on a bed.

Carol: Right?

Nik: I sleep on a normal bed. Yeah, I didn’t have a bed frame. I never had a bed frame until, I don’t know, four years ago or something like that. Just using cinder blocks on the ground, and then I was using a … Actually, the last mattress that I had was a used mattress for a Hilton hotel in San Diego that I got for free. And so, I’d been sleeping on that forever, and eventually it just dawned on me, “Okay. It’s time to actually get sleep in at some point and probably get a bed that helps me along the way.”

Carol: Yes. So you bought an awesome bed, and now you sleep well, and life is complete. That is phenomenal.

Nik: That’s right.

J: Awesome. Next time you’re going to come back and tell us how your business has thrived since you now get a full night’s sleep.

Nik: I’m still waiting for that day.

J: Okay. So, that was our four questions. Now, here’s the “more” part of the Four More: Where can our audience find out more about what you’re doing, find out more about Barnana, and find out more about you, Nik Ingersoll?

Nik: Yeah, so if you want to get into contact with me, you can DM me on the Gram @ingersollnik. My last name is hard to spell. Starts with an I-N-G-E-R-S-O-L-L. Thanks, Scandinavia, for giving me that last name. So you can hit me up on Instagram if you have any questions for me. I also have a podcast called The Nik Ingersoll Show, spelled the same way, available wherever you are listening to this wonderful podcast.

Nik: And you can go to barnana.com to find out more about Barnana. You can also pick it up in Whole Foods or any of your other fine, fine retailers. And that is about it for me. That’s where you can find me. So, hit me up if you have any questions. I’m an open book, and I really do genuinely mean it when I say I want to help people out. So, let me know.

J: Awesome. You didn’t mention Amazon. I assume we can get Barnana products on amazon.com?

Nik: Yes, sir.

J: Excellent. That’s where I’m going next. Cool. Nik, this was awesome. This was tremendously informative. I still have a billion questions to ask, but I think we are pretty much out of time. So I’m going to let you go, but thank you so much for being here today and sharing your story and your expertise with our listeners.

Nik: Thank you, guys. It was awesome.

Carol: Thanks, Nik. We’ll see you soon.

J: Okay, that was a really great show. You know what my favorite part was? It took till the end till he said it, but I really love the part about not listening to what anybody else thinks. Basically, take feedback. Listen to criticism. But in the end, don’t let anybody else’s opinion stop you from moving forward and taking control.

Carol: I know, right? He has so much energy. He has so much enthusiasm. So many actionable tips. And he is just himself every step of the way, doing things in an unconventional manner, and rocking it to make his business incredible. So cool.

J: And you know, the fact that he was so on point and so energetic, really made our jobs easy. This was an easy one.

Carol: Oh my gosh. Easiest interview ever. He was amazing. Loved it.

J: Yes. This was great. So, I can’t wait to go out and try some banana chips.

Carol: Oh my gosh, me too.

J: I was looking on Amazon before this show, and I’m going to order some now, because I’m really hungry.

Carol: I know. They look delicious. I’m very excited.

J: Cool. Okay. Anything else to add before we sign off?

Carol: Let’s wrap it up, baby.

J: Alrighty. Everybody have a wonderful week. She’s Carol. I’m J.

Carol: Now, go ignore everyone else’s cynicism today, and make yours great. Have a super awesome day, everybody.

J: See you guys.

Carol: Bye. Thank you.

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In This Episode We Cover:

  • Nik’s background and how he has been hustling since he was a kid
  • Starting various businesses and founding Barnana
  • How he taught himself to code
  • Taking on a huge undertaking by starting a massive retail business
  • Barnana’s crazy supply chain
  • Working with organic products
  • How he raised capital creatively
  • Figuring things out one part at a time
  • Channel strategy
  • Best advice for anyone who wants to get into the food retail business
  • And SO much more!

Links from the Show

Tweetable Topics:

  • “You just need to be hustling every single moment that you got.” (Tweet This!)
  • “Opportunity only comes around sometimes. You need to grab it.” (Tweet This!)
  • “Naivety and optimism—those two forces combined can create some amazing things!” (Tweet This!)
  • “You have to raise money to scale.” (Tweet This!)
  • “Do not listen to what anybody else says.” (Tweet This!)

Connect with Nik

What does it take to start, scale, and sell your own business? Every Tuesday, J and Carol Scott ask this question to entrepreneurs of all stripes and delve into stories that go beyond the launch. From hiring and firing to marketing and raising capital, this podcast takes an honest look at the triumphs and stumbles of entrepreneurship. Whether you’re looking to sustain a startup or bring an idea to life, you’ll come away inspired. Tune in—and learn how to treat your business like a business.

    Anna Catron from Fort Worth, TX
    Replied 2 months ago
    So, was there a reason he was sitting in the dark during the interview? Great interview! I love hearing about the organic, sustainable, fair trade startups!