She Built the Mushroom Brand All The Wellness Girlies Are Trying

0:00Hey business besties, welcome back to the Female Founder World Podcast. I'm Jasmine. I'm the host of the show and the person behind all things Female Founder World. Today I'm chatting with Charlotte Cruz, the co-founder of Alice Mushrooms. Welcome. You are now entering Female Founder World with your host, Jasmine Garnsworthy. Hi, thanks for having me. People that don't know Alice, what are you building? So we make functional mushroom chocolates. We have three different chocolates. We have one for sleep called nightcap, one for energy and focus called brainstorm, and one for sexual wellness called Happy Ending.

0:31I need the sleep one. They're amazing. I do not sleep. I up my the recommended dose pretty much every night. You launched in 2022? Yeah, October of 2022. Okay, you're pretty new and I've seen you everywhere. Yeah, about two years in, we just had our second birthday. Wow. Crazy. But yeah, it's blown up. Okay, let's talk about how all of that happened. When did you start working on this? What were you doing in your life? Yeah. So my background, I'd been in media and marketing for almost a decade. I've been working doing branded content at digital publishers. And I got to a point where I was starting to just feel burnt out by that and not inspired.

1:11Could not come up with another campaign idea to sell a watch to a guy on Wall Street. I was out of those ideas. And I did some soul searching and it really became apparent to me that food was where I felt like I could have the biggest impact. Those are the stories that I loved telling more than anything when I was in media. So I went back and got my master's in food studies at NYU and started working on some early stage consumer food brands. In parallel, my business partner, Lindsay, on the other side of the country, her background had been in pharmaceuticals and she'd been doing pharmaceutical sales and medical device and dermatology for almost a decade.

1:46And she went down a very similar path where she was like, this is not inspiring me at all anymore. If anything, it's making me freak out. And she started looking for natural alternatives that weren't just Band-Aids, which is so much of what the pharmaceutical industry is. So she quickly got super into mushrooms, started playing around in her kitchen, brought in a homeopathic doctor and they were like buying chocolate at Trader Joe's and melting it and breaking apart little capsules and tasting things and seeing what worked. And that's where the early formulations for NICAP and Brainstorm came from.

2:19And around that time, she was like, I've got something and put out the word about Signal to find a partner. And we got put together on a text thread during COVID in the summer of 2021. And we just started texting and talking on the phone and then started working together and the rest was history. We didn't meet in person for four months. Oh my gosh. Also, which goes against all of the advice for finding a co-founder. Amazing. Yeah. We just talked on the phone and like, if you know, you know. Talk about launching the business. I'm really interested in this because like I said, you've been around for only a couple of years and I see you everywhere.

2:52You're doing so much and that's really hard to do. And I feel like it had so much to do with this really impactful launch period that you had. Yeah. And as you've launched, like you've got three SKUs now, right? You, as you've launched each one, I feel like you've done them all like really intentionally and have like really reached the right person as you've been launching it. At the same time, you've also done consulting for brands. You launched TBH, is that right? Yeah, I was part of the early team there. Okay. Lessons from the first launch. What worked from when you first launched Alice that you would recommend other folks try and do?

3:27Yeah, I think we just came out of the gate super strong. And I think Lindsay and I, she'd been working on it for over two years, the two of us together for about a year and a half. And so we had a lot of time to think about what the product was, to think about how we would bring it to market, who it would be for. And that intentionality, I think, is paramount. I think like we could have launched the brand probably eight months before we did, but we there were things that we were like, no, we want to show up in the right way. And so I think not rushing is number one. And I see that kind of across a lot of different people because you get so excited to launch and you only get one launch.

4:02So do it right. And what we did actually is we got really into what the brand was and who the brand was before we launched. So we brought on this team of consultants who did what we call brand therapy, where Lindsay and I would lay down on the couch and go camera off and they'd ask us questions like, what books does Alice read? Or where does Alice go on vacation? Or like all of these different things. And so we got to know who Alice was, what the brand was really intimately. And so that made every decision that came after really seamless. And so the launch, it looked so put together and it looked so intentional because we'd figured all of that out ahead of time, where I think a lot of people build the ship as they sail it.

4:44And we're definitely do that in a lot of aspects too. But I think when it comes to brand, that's really important. But tactically, we did a really big influencer campaign when we launched, we reached out to, we'd probably like a hundred to 200 influencers. And we, I went out to LA to Lindsay's house and we packed these boxes for three days and wrote handwritten notes to everyone. hey, we're launching. We put flowers in the packages and overnighted them so the flowers would still be fresh. It's crazy. But did a lot to get organic out, word of mouth out. We did a big launch party in LA and Venice Beach the night that the product launched, which was really fun and built a lot of hype.

5:23And we invited press and influencers there. And then we started spending on Meta day one. And I think that helped us come out of the gate really strong too. I'm going to talk about fundraising and funding in a second because obviously you've launched with some funding. And I think like people listening thinking, okay, I'm bootstrapping. I can't do a big party, like all of those things, which is fair. But I think we can drill down on the fundamentals, which was you had some kind of IRL moment with influential people there, which can be scaled up, scaled down, depending on budget. And you did this really intentional and like quite big influence moment at launch as well.

5:58What was the process for selecting influencers, outreach, all of that? For people who haven't done that before or haven't been successful in doing that, what can you share? Yeah. Reaching out personally, I think, is really important. As in you as the founder reaching out? Yeah, you as the founder. Or you can come from the brand account and say, hi, Charlotte here, co-founder Alice. For finding the influencers, it's look at your network, right? Look at who you follow, who you're really inspired by. Ask your friends and then look at who they follow and then keep just plugging away at it. And some people, thoughtful messages.

6:31This is something I learned from doing influencer marketing years ago, but influencers and anyone on the internet can tell if you're spamming them with a turnkey message that you've sent to everybody else. And so I always made sure, hey, big fan of yours. I love that your dog Cookie wore that really cute sweater last week. I'm getting my dog a similar sweater. You know, something that makes it personal. And I think that actually moves the needle way more than you would think it does. That's a really good insight. I totally agree with that. Like being on both sides of influencer marketing, I think like when somebody reaches out and I know that they've copied and pasted their email, I often don't even bother looking to see what it is that they're trying to promote.

7:13So I'm like, oh, they don't know me. They're not going to be recommending something that I'm going to be interested in. So I think that's really important. So think about all of the SaaS emails that you get. Yeah. It's just like Charlotte looking to improve revenue before. And it's That's the same thing that influencers are getting every day. Yeah, absolutely. That's such a good way of looking at it. The way that you're getting pitched as a business owner from like tech providers and like service providers is the way that influencers feel from brands. Exactly. Like how would you get around that if somebody was pitching you?

7:42I also think what you said there, like that sending those personalized messages and bringing that intentionality to it, it requires a serious, it's a time commitment. And there's a reason why people have dedicated influencer marketing managers and like people that only do this because it takes a lot of time. But if it works, it can work really well. Yeah, exactly. And it's worth it, especially at the start. Yeah. I want to talk about press because you got a feature pretty quickly, like right after launch. How did that happen? So we, again, this also has to do with funding, but we invited our PR team, invited an editor from Forbes to our launch party.

8:18And I think my business partner, I just got along with her really well, struck up a relationship and she wanted to do a feature on us, which was, but we, yeah, we had a feature in Forbes like very quickly after we launched, which was wild. Wow. That is wild. Let's talk about that funding. Yeah. Have you, I couldn't find like numbers of how much you priced. Is that intentional? You guys don't share that or am I just not good at researching? You're great at researching. It is not public domain. That's fine. Okay, when you launched, talk me through the process of fundraising and what you can share about the process.

8:53So when Lindsay originally had the idea, there was an amazing angel in her network. Actually, Dick Costolo is the former CEO of Twitter. And he gave, I'm going to give you a small track. And it wasn't small to us at the time, but it was huge. But he was like, I'm going to give you enough to see if you can make this work. And so that's how we got branding off the ground, hired some formulators and all the initial stuff. But like we were still very scrappy about it. And then once Lindsay and I joined forces and found a co-man and all of those things that made us a co-manufacturer. Yes. That made us realize, OK, this is real and this is happening.

9:29We went out and raised a seed round and that was mostly from angels. And that was all on a safe note. I think, I don't know if you guys talk about safe notes a lot, but that's the most founder-friendly and investor-friendly way to raise in the early days because it's like one page of paperwork. And it doesn't require anyone to do tax filings because it's basically just a fancy IOU. And those shares then convert later when you do later fundraising rounds. And so we just raised on safe notes and we did, we worked our networks really hard. And I think particularly when you're pre-launched, it's a really tall order to fundraise, which is why we did most of it post.

10:05And then as we grew, we're very intentional about not raising more than we need, because I think that's something that happens a lot. And you can very easily overcapitalize yourself and get to a position where you think that you need to spend all this money because you have it. And that isn't necessarily the most responsible business decision. So we're very intentional about raising the right amount. But to fast forward that, we then last summer raised our first institutional capital from Alcaterton and their early stage growth fund. and then brought in a few more strategic people. And it's been great.

10:38So that leads me to my next question because you have quite a few celebrity investors as well. Yeah. Can you name drop a few? Yeah, we recently took on capital from Kevin Hart and Pedro Pascal and Zac Efron. And then also Dr. Jennifer Ashton, who was the chief medical correspondent at Good Morning America and ABC News for 13 years. Okay, lots of questions. How does somebody find a celebrity investor? Like how does that even happen? and what is the impact on the business? Did it change anything for you guys? Did it open up anything or was it just a check? I think it can be whatever you make it.

11:16And I think different celebrities want to have different levels of involvement. Some deals that celebrities will strike will have a kicker or extra equity. And so that's where you make it more than a check. And some celebrities - What does that mean? Essentially say that I'm celebrity Charlotte, right? And I come in and I say, okay, I want to give you$50 ,000 to invest in your business. Normally, if I'm just a Joe Schmo on the street, I just get the equity back that the$50 ,000 buys me at that valuation. But a lot of celebrities will want additional equity on top of that in order for them to promote your brand or kind of be a face or be someone who is associated with uplifting the brand.

11:56So there's different ways that you can strike it. We just went a very simple, straightforward investment route, but it's been great. Just the legitimacy of having celebrities on your cap table. I think more than anything else, it's just, okay, people that I know and respect are in this brand. I think it functions the same way as if you have a great venture fund or a private equity fund involved with you, but with celebrities, that's something the mass consumer can understand a bit more. And so that provides that mass legitimacy in a way that like someone who's not in like the venture capital world in New York City understands.

12:29And yeah, I mean, we've really enjoyed having them. And how do you actually get introduced to celebrity investors? Was this through like an existing network that you and your co-founder had? Did you work with? I know that there are like agents that can connect you with these folks. Okay, business besties, let's switch gears for a second. Real quick, I want to talk to you about this season's presenting sponsor, Vistaprint. They are sponsoring this entire season of the Female Founder World podcast and we love a supportive sponsor. So much so that we're actually working with Vistaprint ourselves to create the merch and all of those beautiful event perks that you know and love from our in real life Female Founder World events.

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13:55Use the code FFW25 at checkout and step up your branding game. We put a link in the show notes if you want to learn more. Yeah, it was mostly through networking. Lindsay lives in LA, so she's much closer to the celebrity world than I am. And so through friends of friends, getting connected to some of these celebrities, and then the people who manage their investments. and once you can meet those people a world opens up which is really exciting that's interesting let's talk about wholesale you're in okay so i've again i've got old i've got old data here but it's more than 400 stores that was from august i'm guessing you're in yeah now we're probably at this point around 800 ish wow okay yeah air one who else air one lassens a bunch of regional places in la um like independent stores yeah but with 10 to 15 locations okay so air one adjacent yeah Yeah, Bristol Farms, things like that.

14:47And then we're in a lot of independents, which that's really been the biggest chunk of our wholesale has been our independent retailers, which we love. And then we're launching with our first national retail partner in Q1. Amazing. Okay, I'm so interested in this like indie to chain pipeline because it's something that we talk about a lot. We have a literal program called Retail Bootcamp where all we do is teach indie stock astrology because I think people can think, oh, but I just need to get into Target or Whole Foods or whatever and completely sleep on this amazing opportunity for distribution and sustainable growth and also just like brand building that some of these indie stores can bring if you're in the right place.

15:33It can really elevate your brand. Totally. I want to learn a little bit more about your strategy and how you've actually built up that indie business. Yeah, totally. I think it's so important as a first step in the retail strategy. Truth be told, when Lindsay and I launched, we were in the camp of Let's Be D2C for two years. Get as many learnings as possible and then start talking to retail. Which makes sense, right? Because you learn about your customer. Exactly. All of these things. And that was from the D2C boon of 2019, 2020. That's what people were telling us. But you're a food product. Yeah, exactly.

16:08And so right after we launched, we already had retailers reaching out to us. And it was just these inbounds from independents. And we were like, why would we say no? So we started saying yes all the time. And it just took on a life of its own. So for the first year, it was mostly just inbounds. The only door that I knocked on was the Elk in New York, if you know them. I'm obsessed with them. And it's my neighborhood. So I went in and was like, please. And they've been great partners. But yeah, it really was mostly inbound. And then we got on FAIR. And I'm sure you hear a lot of other founders talk about FAIR and some of these online marketplaces.

16:43And that's just taken it to the next level. And then this other platform called Air Goods, which is kicking off. Air Goods. I don't know it. I'm going to look it up. What's Air Goods? They started at least, and I don't know if they've repositioned at this point, but catering to non-alcoholic and bottle shops. But now I think they do a little bit more and they're competing a little bit more closely with fairs network but we all you have to do is list your product on these marketplaces and people can find you and it's these independents and we've grown to around 800 ish independents and the strategy you're on there and what lindsey and i call it is we call it the graza model because we're so inspired by graza and i feel like every shoppy shop you went to for a while and still go to the graza's there yeah and you Which is the like olive oil.

17:27Olive oil. Exactly. And you look at what they did where they showed up in all the right places to the point where you got the education on them and your cool corner shop because the people who own the store knew what it was. You could see it placed in a setting that is aspirational to you or something that you already trust. And then by the time it's in Whole Foods or Target, you already have a connection to it and you're more willing to go in there and buy it when it's a higher price point than maybe what you're seeing otherwise on the shelf. at Whole Foods or Target or wherever you're going.

17:57So that was really important for us, particularly as a emerging product in an emerging category. Mushrooms are still, there's a lot of education that still needs to be done. There's a lot of questions that consumers have and people are really excited about mushrooms. And I think we're still just at the beginning of the mushroom renaissance essentially. And so showing up in these places that feel really trusted, feel smaller, more boutique, we think made a huge difference. How do you manage 800 independent stockists? Yeah, we were doing it all manually, like just on email. Email. Email, where Lindsay and I have an incredible shared EA named Karina, and she has taken over.

18:38I used to do all of it, and then now Karina manages all of the order flow and processing. Yeah. Literally like emailing, what's your address? How many do you want? Okay, making a QuickBooks invoice, sending it to you and manually inputting it in my 3PO. Yeah. So it's like as manual as it gets. Do you have a CRM where you're like tracking all of your stockists or anything central like that? We should, but we don't. It's just like in your inbox. It's just in our inbox. And then FAIR and these other platforms make it pretty easy where they just order through the platform. We input it and it goes from there.

19:08Amazing. I think that also speaks to, again, for anyone listening who's thinking like, I'm not getting the inbound and all of that. There are things that you can do to boost you in the FAIR algorithm as well. If you bring business to FAIR and it boosts you in the algorithm. Yeah. And you can advertise on FAIR now. Oh, really? Yeah. We've been putting, last month we put$500 into the FAIR ecosystem and made$2 ,500 from new customers. Wow. Okay. Have you been doing it? Who on the team does it? Do you have an agency? It's literally so easy. I literally just go into FAIR. They've emailed us about it.

19:41And I was like, yeah, okay. And I went in and was like,$500 approved. Click the button. Are you just like creating an ad? No, it's not. It's basically just sponsored listings. So when someone searches maybe mushroom or the first thing that comes up on FAIR or if someone like just as a promoted listing. Yeah. Yeah. Recent. Okay, everyone get onto the sponsored listing. That's really interesting and makes so much sense for FAIR as well. Totally. And when you think about it too, that's already a 5x return if we put 500 in and got 2 ,500 back, but then think about the lifetime of those stockists too.

20:14Okay, this is very interesting. Let's talk about Black Friday and holiday. You've gone through a couple now. We're just on the other side of Black Friday, Cyber Monday. What are your lessons? What are you going to be doing differently next year? What are you going to do the same next year? Yeah. Every year we learn a new lesson. Last year, the lesson was we didn't prepare early enough. And I think in consumer now you have to be, you can't just run 30 % off. People want gifts. They want excitement. They want limited edition. So last year we didn't plan for that early enough. And we did different gifts with purchase every day.

20:48But basically we only had a hundred of each thing. So they ran out really quickly. And I think it just caused confusion for the consumer. Well, if the thing is sold out, my free thing, I'm going to come back tomorrow and see what the next thing is. So this year we, in August or July, ordered all of the gifts with Birch's that we wanted. And we did much more forward thinking about Block Friday, Cyber Monday. Looking at this year, it went super well. But I think already the postmortem that I'm doing is that I don't think that we did enough, like, actually into the site of site design. This is what the discount is and here's what you're getting.

21:23What does that mean? We did like in our email really explain the sale and we had a pop up and we did a like a top line banner. But what I saw other brands do really was like they basically redesigned their website for Black Friday. Yeah. Because I think there is so much noise around Black Friday. So you need to make your message and your value prop as clear as possible. And so if you're doing really exciting gifts with purchase, redesign your website and show all of the free stuff people are going to be getting. What does your email and social content cadence look like during this sale period?

21:55Email, we were doing every day. On Black Friday, I think we did two. SMS, we definitely went after it as well. We did two texts on Black Friday and then every other day pretty much just one text. And then social, mostly on stories. We didn't want to clog the grid with a lot of Black Friday stuff. Who do you guys use for SMS? We use attentive. Okay. Yeah. They're great. Yeah. Yeah. Trying to get attentive to sponsor us. Attentive if you want to reach out, if you're listening. I'll give them a little time. Come and sponsor female founder world. That's really helpful stuff. I appreciate the very tactical like reflections and advice and all of that.

22:29That's really helpful. The last thing I want to talk to you about is this idea of it's only been a couple of years. You've gone from employee to student to now co-founder of this fast growing company that's really visible and doing really well and like all of these things. how do you up level up level might not be the right word it's also grounding yourself I think as well but to be able to continue to show up as the leader that your business needs do you have anything that you're practicing doing thinking about challenged by can you talk a little bit to that yeah it's the hardest thing that I've ever done for sure the tools that I use and it's something that Lindsay and I both we talk all the time but that we're struggling whether that we're working on or that we're coming to terms with the fact that we are leaders in this business and ideally leaders in this industry.

23:18And what does that mean? And how do we hold that with grace? And also with confidence, I'm in therapy once a week. That's like my therapist at this point is literally just like, you can be confident. And that's what we work on every week. And honestly, like the biggest thing for me has been getting a dog. I got into a place where it's so easy when you're doing this to just burn yourself out, stay in your New York little apartment and just work for 15 hours a day or whatever it is. And I think you can lose yourself really quickly in that. And you don't take time to take a step back, think through things.

23:55It's easy to be really reactive in that scenario. And so getting a dog has slowed me down in a way that's allowed me to speed up. I love that. Yeah. Can you leave us with a recommendation, a book, an app, something that's helping you as you've been building the business? Yeah. Honestly, it's going to be a tech recommendation. Another female founder that you should definitely have on, I don't know if Gina from Stay AI. So Stay AI is a subscription management platform. And so we just switched our business over to being subscription oriented because as a supplement, that's just like really what makes the most sense.