From Startup to Scaleup: What Nobody Tells You About Hypergrowth, with Little Moons founder Vivien Wong

0:15Hello and welcome to the Tomorrow Brands podcast, where we explore what it takes to build a brand of tomorrow. I'm your host, Ruth Vitock, and today's guest is Vivien Wong, co-founder of Little Moons. If you're an FMCG, you almost certainly know the brand already. the mochi ice cream that went from cult Japanese dessert to TikTok phenomenon to supermarket staple. But what you might not know is what it actually felt like on the inside of that rocket ship, going from a factory floor in Park Royal to a team of 400 people during a global pandemic, with empty shelves, no processes, and dads driving to London from Wales just to find product.

0:46In this episode, Vivian and I skip the origin story and go straight to the stuff that's harder to talk about. The moment the business changed shape, when to hire, who to hire, the TikTok talk moment nobody planned for and the operational chaos it unleashed and what co-founding with your sibling for 16 years really looks like. This is a masterclass in scaling and staying sane while you do it. Let's get into it. Hi Vivian, thanks so much for joining us today. We're going to do something a little bit different because I know you've told the Little Moon's origin story a lot of times and I think most people listening will be familiar with the brand.

1:18So what I thought we'd talk about is that scaling journey, so that moment where you sort of tipped from startup to scale up, the decisions, the people, you know, the moments where the business changed shape. So rather than go back to the very beginning, why don't we start there? When did Little Moon stop feeling like a startup? Started feeling more of a scale up when we hired our first heads of departments. And I think that that was when we were around 5 million turnover. Because up until then, I feel like my brother and I did everything. We didn't really have specialisms at all. So we were heads of sales, marketing operations all of that and it was only when we hired our team to to have a head of sales have a head of marketing head we had an operations director and oh finance head of finance and that's when I feel like we became a proper team an executive team who and that's I think one of the questions you we talked about before was when did you hire people that were smarter than you and I think I've always hired people that are smarter than me but these guys specifically were very, very good at what they did.

2:21And there was nothing I could teach them about selling or marketing or finance, you know. So yeah, I think that was the moment. And how did you know the business was ready to make those hires? And did you feel like you were ahead of it or behind it or right on time? Because I know there's always that challenging bit where often people leave it too late. So by the time you know you need a head of, you probably needed one six months ago and then it can find six months to find the right person. Yeah, we had the advice of our non-executive director, our Ned, who had been on our journey from earlier than these guys, but we still felt like a startup.

2:54But he said to us, guys, I think you're ready. And he was the one that prompted us. It didn't come from us. And this is where it's very helpful to have a Ned on board, like someone who's been there and done it before, because you don't know what you don't know. I think I might have continued struggling myself, trying to continue doing everything. But he said, now's the right time. So it's interesting when we talked about what level do you hire for? So this was in 2018. So when I talk about the salary levels, they're going to be quite different. But do you look for a head of that$60 ,000,$80 ,000,$110 ,000?

3:26Like what level do you hire at? And he said, pay for the most that you can afford because a£60 ,000 mistake is a very expensive mistake because you might hire them in and they're not quite experienced enough. Whereas if you're paying someone 80, then it's a lot, but you get the value because you're not then babying someone through it potentially. And I thought that was really good advice. I'd never thought about it that way. But he said, you know, someone who's over 100 wouldn't be great for the business because they would be bored. There's not enough for them to do, you know. So that was kind of how he talked about the levels.

3:58I guess as well, in a rapidly growing business, you sort of need to hire for where you're going, not just where you are, because what gets you from, I think I heard someone say once, it's sort of it goes in seven increments. So what gets you to one to seven isn't the same as seven to 14 isn't the same as 7 to 21. And it's the same with teams of people. And I don't know if the breaks are exactly right, but it's definitely true, isn't it? It feels like a very different set of challenges. Yeah. And I don't think there's any shame in knowing where you are on those levels because I think as we've grown, we've had people that were perfect for our growth from zero to seven and then they haven't been quite right for the next stage of growth.

4:34And that's okay because the people that are growing the business from like 7 to 14 don't have the same skills as the people that grew it from zero to seven and I don't think there's any sort of shame in that although it's been really hard to say goodbye to certain people on our journey the difference between hiring for where you are versus where you're going especially in those sort of oh yeah it depends how quickly you grow as well so if you are I don't know like more like not steady state but you are growing but not rapidly growing people can have a chance to grow into their their roles a bit more and sometimes that's a more comfortable way to grow but if you're growing if your growth is like 10, 20, 30, 40 million every year, that's quite a lot.

5:13And actually, we doubled in size each year. So that puts a lot of pressure on your team. And so they had to grow rapidly as well. So I think when you're thinking about, are you hiring for the next one year, two years, five years, I think I would look at sort of maybe two year increment if you're a fast growing business. So what changed about how you ran the business? You brought in this sort of leadership team? What did that mean you had to do differently? So I actually spoke to my coach and I said, I think I've just made myself redundant. I've hired all these brilliant people, can't teach them anything.

5:44What have I got to add? And I guess what I learned along the way is like, you have to be the conductor of the orchestra. They all are specialisms in their topics. So let them get on with it. But they need to work together as a team. And I guess that's where my brother and I came into like our roles, which was just making sure that they were working together. And did you, have you found yourself to be very instinctive as a founder or, you know, data and evidence base? And has that changed as the business has evolved? So my brother is very data and I'm very instinctive because we're complete opposites.

6:18And that has always been the way that we've operated, which I think has meant that we've done well together because he needs the data and I have the intuition. But I think it's definitely a mix. It has to be a mix. And I think, you know, if there's a scale, like sometimes people making financial decisions obviously you need the data sometimes you need market market data but if but i always say this i could have gone to market and there would have been no data that mochi would have done well like no one was asking for it no one knew what it was so that was instinctual yeah and i guess it's like if the category doesn't exist yet you can't spot a gap in it yeah yeah it's just like when i always say this when when forward with building cars if he asked the consumer what they wanted, what the market wanted, they would have said a faster horse.

7:02I love that expression. So within that transition moment, there must have been some sort of structure that you needed to put in place that you probably didn't have to do when you were a much smaller team. What went wrong and what went right in that moment? And how do you feel about processes? When we brought the heads on, we didn't have processes in terms of morning meetings, time to bring everyone together, because it was just my brother and I. We lived together. Our morning meeting was probably just yelling at each other over our morning coffees or something. You know, like, what are we doing today?

7:32What's gone wrong? Oh, my God. And so I guess it was putting those cadence of meetings, cadence of following up, cadence of one-to-ones and all that sort of stuff. That's, I guess, the easy, obvious things that you need to do. But then I guess the problems arose when we grew really quickly. It became very apparent that we had very loose systems for a business that size. And with the beauty of hindsight, I wish I'd worked harder on those systems to begin with. For example, in our factory, we would bring on one or two new people every, I don't know, a couple of weeks. Our turnover wasn't high. So when we needed someone else, they'd come in, they'd shadow someone else that knows what they're doing, and they'd verbally teach them the job.

8:13Then they get on with it. Great. Well done. Everyone's happy. But when you're scaling really quickly and you're bringing on lots of new people, you need to have SOPs, Standard Operating Procedures. We didn't have any of that written down. like nothing was written down and so those are the sort of things you start noticing and then I guess there's like other systems like HR processes of bringing obviously we had employment contracts but we didn't have our values written down anywhere it was sort of by osmosis nothing was codified so these are all the things that you can be working on behind the scenes for every single job that there is so if you need to hand over very quickly you can say read this this is how we pay people these are the checks that we go through before someone's paid this is what we do when we bring in products to the warehouse, like you check all of this stuff.

8:59And that was, I guess, for the food safety stuff, we definitely had those processes in place. But everywhere else in the business, like what is good branding for us? What are our brand guidelines? All of these things were the things that were important for us to have written down and we didn't. So we had to do it very quickly. And was that sort of a someone's asked you and you've suddenly gone, oh my God, we don't have that. Someone go write it. Or was it like a case of speaking to other people and putting a plan in place? I think when people asked us for it, we just thought, God, we should have that written down.

9:26And then we'd start writing it down. But when everything starts coming at you at once, it really slows the business down when you've got to write the process first before the process gets done, because you actually needed the process done yesterday. And now you're delaying it and it gets very frustrating. And I often say this, like business is full of all of these boring, minutiae, it's a collection of all of these tiny jobs that are really, really dull, that helps you have a successful business. Yeah, I think people don't hear that enough, do they? Especially in fast growing business, like growth sounds really exciting and fun and it's great and it's what everybody wants.

9:58But the reality of being on the inside of that, and we'll talk about that in a bit as well, especially those like hyper growth moments, don't feel particularly fun often. Yeah. So let's go back a little bit and talk about first hires. So building the team from scratch when it was just the two of you. Who was your first hire and how did that change how the business worked? We always had maybe a handful, I'd say between five and 12 people that worked in the factory for us making mochi. And they were our first hires, but they weren't like, I guess, our first office hires. They were the people that we'd sit down and make mochi with and pack.

10:32The office hires, my first hire was our technical manager. That is the person running the factory, making sure that food standards were met, that we're meeting all of the health and safety rules. things that you absolutely cannot get wrong, things that cannot fall through the cracks. And that's something that I didn't want to do. I just, I'm not the person to walk around the factory ticking off that we like, we put five wooden spoons in the factory yesterday, we've counted back five wooden spoons to make sure that we haven't lost one in a mochi. You know, those sort of like, details that are so important when you have a food factory, check every metal detection machine is working.

11:09Those sort of tasks, they're too boring for me. So we hired our technical director because it was the most important thing. Product has always been the most important thing for Little Moons. And that was part of that element. And then after that, I think we then brought on the more junior ops director to help with the day-to-day running of the factory. Because as we became busier, my brother and I, I think problems within the factory were just overwhelmingly taking up too much of my time. Sometimes the milk didn't turn up. Someone has to go and fetch the milk from our milk supplier. Like stuff like that.

11:40Like, oh, we ran out of sugar. Someone forgot to order it. Organizing all these tiny things that go wrong in a factory. That's what my ops director started to help us plan for and then make sure that that didn't happen again. Why did someone forget to order the sugar? What was wrong with our process there? Let's try and make sure that doesn't happen again. and so that meant that we my brother and i could leave the factory to do branding or to do the sales or to go and meet chefs or to do an exhibition in germany we couldn't run the factory every day and it gave us the freedom to leave to try and drum up more business and so these are the tiny little steps that we were running that we allow us a bit more freedom to grow the business rather than just constantly fixing factory issues so get someone in to do the boring but important very important stuff and then what came first sales or marketing hire they came exactly the same time that was when we hired the heads of they all joined exactly the same time we're interviewing for all of them however we were always doing sales anyway right we naturally did sales from when we supplied it as food service it naturally comes to both my brother and I to do that sort of sales role when it comes to marketing we didn't actually the traditional sense of marketing yes we had to do flyers and things like that but when you talk about marketing of a consumer product when little moons became branded I think that's when we started thinking about all the details of our brand and my brother is really good at that like the logo the colors the present how we present on pack that he was the one that really drove all of those details when we were talking to branding agencies yeah he did an amazing job he did an amazing job looking back do you think that was the right call did you get that all in the right order would there be anything you'd have done differently on that i wouldn't i think we did great i mean there's there's other things that i wish that i had done better but you know if we're talking about that specific moment in time i think we did really well and we brought the most incredible team on we're really lucky that those people took a chance on us we were tiny back then we weren't even i think we were just about entering at cardo so we were already listed in whole foods but we weren't a big brand at all so those people really did take a chance on us any hiring mistakes you see other brands make other founders make I sometimes when I do speak to some founders I feel like they bring on someone to run the business like as a CEO too early and then suddenly they're creative director and they are flitting around a bit and unless you have someone really really really good like why wouldn't they start their own business one at that size right and then I feel like they're a bit too hands-off a little bit too quickly then you're paying someone to do the work that you should really be doing to save the money because every single pound that you're paying someone else to do it means less money for you to invest in the business which is why I was bookkeeper for many many many years to save myself like 25 to 35 000 pounds a year for a bookkeeper you know but it just meant I didn't have a sundae but that was okay for me and so I do see that some founders come in and go oh I've got real business now right I need I need a team.

14:37I need someone to help me with all the tiny little bits when actually you could do it. So you have got a CEO now. At what point did they join and did that feel like the biggest decision that you've made so far? I think the biggest decision for us to make with Little Moons was to go for investment with private equity, to bring on private equity. That was a huge decision because it's really changed how we work as a business. We've professionalised so March bringing on partners, different shareholders. So it's not just all about what Howard and I would want. We have to consider other shareholders.

15:10And we worked really well together. I'm not saying that it's been a problem, but it's a change. And then when we were in the market finding investors, the guys we went with, El Catterton, suggested we would like to bring on a CEO. And there was only private equity that had said that to us. Everyone else backed us to continue running the business. And so we thought really long and hard about it. And I thought, what are my skill sets? What do I really enjoy doing? And we made the decision that, yes, I think bringing on a CEO would be a really good decision to make at this point. And so we retained control over the things that were important to us, which was largely brand and product.

15:48So we do all the product development. We have a say in all the things that we produce, which is very important to us. So let's talk a bit about hyper growth and the very famous TikTok moment, which I'm not going to go too much into because I'm sure you're sick of talking about it. But it was a very kind of iconic FMCG from working in brand and marketing. I think that was the tipping point where suddenly everyone said, can you go viral on TikTok? And we were all like, oh, thanks, Little Moons. You really ruined it for all of us. How do you recreate that? So just to summarize for everyone who doesn't know, it was during COVID, right?

16:22And then kind of out of the blue, Little Moons just went viral on TikTok, but it was crazy. It was a true viral moment. I remember at the time I had friends with teenage kids who were saying, my kids are dragging me into grocery stores and they've all sold out. I don't really think it's been replicated since either. So let's talk about what happens behind the scenes when something like that happens. So obviously when brands are running big ad campaigns, they'll do lots of forecasting really far out and really prepare for that moment. What happens when you do have a overnight step change like that?

16:57I like how you said you have time to prepare when you're about to do a campaign. You've made some stock because you know you're going to have some larger pull throughs and things like that. And I don't know what uplift some brands expect when they're doing a campaign, a TV campaign, for example. But if I can set the tone for Little Moons, we went viral on January 2021. In December before that, just the month before, we had shipped all of our stock to Europe because that was when Brexit had finally, they said, right, end of December, that's it. Every single import export has to be custom checked and it become real.

17:33And so we knew that it was going to be a bit of a mess of everyone understanding what custom checks were going to be. And we had a big business in Europe. So we shipped every single bit of product that we had over to Europe, which was great because we serviced our European customers brilliantly but we didn't go viral in Europe and so in January usually ice cream is dead so January February March is when you build up your stocks for the summer we came from an empty warehouse just to lay the scene for what our factory looks like like no product and then Charlie who was running our social media would come to morning meeting and say guys I think something's happening with our account like our TikTok account used to have like 10 10 views and that was probably the 10 people on our team and And she'd come and say something like, oh, we've had a thousand views.

18:17That's really cool. That's weird. And then the next day she'd be like, guys, we've had 10 ,000 views. This is something's happening. And by the end of the week, it was like 100 ,000, which is beyond. And then we had Tesco's call us and say, you know, when you plan production. So Tesco's will say something like, we will take 50 pallets over the next three months. And we'll be like, great. So then we tell our factory, guys, you need to make two pallets a week. We'll store it up and we'll deliver it to Tesco's on this date, three months in a while. Something like that, right? And then Tesco calls us and says, guys, we've used up all the stock that we've had for the next three weeks or months.

18:48We need 50 pallets tomorrow. We're like, where are we going to magic this up from? We have humans working in the factory. We can't just work 24 hours. This is one team, one shift that we have planned. That's all we needed. So I guess when people contract manufacture, they might come from a bigger factory so people can then pile on the shifts or something. Maybe push back production for another brand that isn't doing as well. They can shift things around. But for us, we only make things for little moons. So what we could do is all hands on deck just to make little moons. So we had to bring on new people to bring on a second shift because we only ran one shift.

19:23So then we were working two shifts. And then we couldn't make any more. So then we need to bring on people to run a 24-hour shift. And then we need to plan how do you clean the machines in between all of this and the tiny minutiae that it takes to run a factory. And ultimately, then it just becomes the execution of running a factory because we've done the marketing. We've done the sales, all of this. The only problem that we need to solve for is how to make enough product. And so it was just that was all we turned our attentions to. How can we make more product in the middle of COVID? And so we couldn't order more machinery because no one was working in the factories making machinery, really.

19:57When we did, if we did make enough product, we had a shortage of cardboard. Everyone's budgeted everything. Rice flour from Asia. No, do you remember all the sea containers were based in Europe and not Asia? And we weren't sending any product back to them. So there was just every single problem that we had, it was just exacerbated by the fact that we were in the middle of this global lockdown. Everyone like, I hate TikTok. Turn it off. I was having sleepless nights because of all these problems. But there's good problems and there are bad problems. And this is just the most beautiful problem that you can possibly have.

20:30It's a great problem to solve for. And so I think that's what kept you going. You just thought, I know this is really hard right now, but look what's happening to the brand. like so many people are seeking you out you're getting phone calls from dads driving around in wales saying i've been to eight supermarkets my daughter said don't bother coming home unless you've got the product so at this point i'm going to drive to london can i come to your factory can i pick up a couple of packs for my daughters and we were fielding loads of calls like that and then we had people like saying um you guys are doing this on purpose i can't believe it i can't believe you're allowing people to queue like this i'm like i'm really not we want people to have product.

21:07We need to make enough product. We're not trying to artificially restrict supply. So, you know, all of this is a backdrop. But then it was also wonderful to see people queuing up around. So we had a pop-up and my brother and my mom went down to look at the queues in real life. I was stuck in the factory. But to see that video, you know, and then our head of marketing, Ross, he had the idea of pivoting this news because it was only a certain sort of age group genre of people that were on TikTok that were then telling their parents about it. But they weren't necessarily our target audience, because earlier on, we thought that our target audience was maybe 30 plus year olds.

21:43And so we thought they were the kind of generation that stuck between having kids that were on TikTok, but they're not really knowing what was happening. So we wanted to tell them about this too. So we went to the press, printed press, the mail and things like that, normal news outlets to say this was happening to our brand, just to drum up a bit more news about it. And I think that was a way that we slowly just kept that going. And then I think the reason why, and I think you said it's not been replicated again, but I think there's been some brands that have gone viral on TikTok and then I guess demand has fallen off.

22:14That's not happened to us. I think it's because we genuinely have a delicious product. And so it was a great way of sampling it. So more people tried it and discovered it and thought, you know what, we really love this product, not just because it's a trend. I see a place for it in our lives as a daily ritual almost. And so people continue to buy it from us. I'd say that's the most impressive piece of the whole thing with this is that it's not easy to go viral, but sometimes that happens. But actually turning that virality into long term business, a stable, successful business is hard. And actually sometimes going viral can work against you, especially with an audience like that, sort of younger, more fickle.

22:54You don't have to look at Prime, which is not a good product. So maybe the answer is right there. But it can work against you because you're seen as like trendy and faddy and it goes boom and then bust. So the fact that you guys were able to turn that into something long lasting and the cleverness of making sure that that news is reaching the right people because that wasn't necessarily the audience you were trying to build with. I think that's what people should look at rather than we want to go viral on TikTok. It's like, OK, cool. But what do you do next is the question. So I have the team went from 100 to 400 people.

23:27Is that right? is that was that yeah that is crazy we just had to throw more people into to solve the problem whilst like socially distinct distancing them in the factory it was big so you know when i i opened with sops like how do you teach 300 new people how to make mochi when you don't have it written down anywhere we had to write it down so that delayed us a little bit as well because the most important through the whole thing was quality like we didn't want to just then put out bad product every single mochi that left off actually had to be at the right quality for us. And you've said that that period left you physically broken, which sounds completely fair enough now that we've heard the backstory behind it.

24:08And I think that's a really good thing to say out loud as well, because it's not the sort of thing that you see on LinkedIn, you know, behind fast growing brands. What did you learn about yourself from that experience? And what have you done differently since? I built a lot of confidence through that period because I didn't die. It felt like it's, Do you know what I mean? You know, when something if something doesn't kill you, it makes you stronger. Like I honestly, at some point, I had no idea what to do, how to solve the problem. People come to me and I genuinely couldn't help them. I didn't know how to help them with the pain that they were going through.

24:40And they were working. My team were working so hard. Everyone was so stressed. And that's not the culture that I want. That's not what we wanted to do. But even though they were so stressed, I think everyone was really excited. They could they could see that this was something that doesn't happen all the time. So they're all trying their best. But as a leader that really cares about their people, it's really horrible to see them go through that. But also, I can't turn up and be that stressed person because you know what that's like when you have a leader that's clearly not coping. So I would feel the pressure to turn up and be like, right, this is what we're going to do when you have no idea what you're going to do.

25:13And that was the pressure that I had. And what did I learn about myself? That I really hold things in. I don't talk about problems. I don't share problems. I am not very good at being vulnerable, I guess, and saying, I don't know what to do. I think I did with the team. They could see that there was pressure, but they still expected to be led. And so we brought on someone and then even Mark, I say even Mark, because he was my guru. I'm like, Mark, what do we do? He said, you know what really helped? He said, I don't think Unilever would even be able to produce with levels like this. And that made me feel better because I thought I'm failing as a factory manager because I don't know how to solve this problem.

25:48And so when he said even a big company like Unilever with like the best systems in place couldn't cope with this sort of scale up it did make me feel a little bit better and less of a failure in my eyes but then I also think it's like the the one great lesson I have learned is the strength of your team because we didn't have processes in place or anything the only reason why we're here is because our team managed to pull together and I guess that is that's something that I did well like I managed to to take the team on that journey and and everyone survived and a lot of them still work for us and And what are the practical things that I learn?