Advice Line with Katlin Smith of Simple Mills

27:09Nice. So are you doing like about five or five thousand dollars a year so far in sales? Yes. This year we're right at$5 ,000 going to about$6 ,000. Nice. If I hit all those targets with all those different stores that want my stuff, I should be selling about$25 ,000 next year. Not quite enough to pay all the bills but headed in the right direction. To start. All right, Tim. It's called Grumpy Dad Sauce Company. I'm assuming you're dad. I'm assuming you're grumpy. Not exactly. Like I say, when the people ask me about it at the fairs, it's like, oh, not what I'm making hot sauce. So I find that most dads are grumpy because they are doing something to help make ends meet, keep the family going, paying the bills and all that, that they probably didn't want to do when they were a kid growing up.

27:58You know, accountant, whatever it is, just to pay the bills, the stress of life, all that stuff kind of gets to them. And what I'm trying to do is be kind of an inspiration to other dads and my kids to where you don't have to just do something just to make ends meet. You can do something you want to do, build a business, build something that you can pass on to your family, start scaling up from there. So, you know, everyone knows a grumpy dad and all my sauces are all themed that way. My mild sauce is Moody Teenager. I got a sauce called Envy, Mood Swing. My hottest one is called Tantrum, stuff like that.

28:29So I'm trying to trade in on that vibe of, you know, the family dynamic. And you've got kids? I have two kids, yes. I have a son and a daughter. They're teenagers. We adopted them from the state foster care system when they were two and three. My son is really interested in helping, and next year is one of our two flavors we're going to introduce is one that he's developing, a barbecue sauce. Nice. Okay, cool. And what's your question for us today? My question basically is – and I kind of have two different ones. I had one before we got on, but in the last week, the last couple of weeks, I've lost another job.

29:06So I have financing lined up and I have enough to scale up to get the co-packer involved for next year to meet all those demands. But my question really is, should I just go crazy and just go all in with it? I know I'm about 20, 30 percent of where I need to be to meet my family's needs. Should I just scale back on the job expectations and just double down on the other side of things and get more people involved? Ask for more annual investors, that kind of thing. or how crazy should I go with this? How much further should I go? Got it. Okay. And sorry to hear about the job situation, but I think this is interesting.

29:46I mean, it sounds like a big part of the motivation around this, not only because you like peppers and hot sauce, but you want to build your own thing. You don't want to be dependent on an employer who can just downsize and lay people off. Yep. Okay, Caitlin, let me bring you in. You've been waiting patiently. Caitlin, all right, Grumpy Dad Hot Sauce. Amazing. I love those names, by the way. Those are just brilliant for hot sauces. So I can just see all these different ways the branding could go and could be really cool. But question for you, what keeps you from going all in? What's standing in your way?

30:24Who's paying the bills? What if that loan doesn't come through? what if I talked to a co-packer a couple of years ago and it was a hundred case minimum, $25 ,000 for the loan and I couldn't swing it, but I found one that's going to scale with me. So I'm at a place where I think I could do it if I planned it out correctly. If I had, you know, scalable goals, you know, by this quarter, I need to be in these many stores and, you know, incremental increases. But there's part of me that just wants to just be like, drop a grenade and just toss it out there and just go and do uber and door dash while to make the ends meet and then do everything else to get the hot sauce out there so that's where i'm kind of at do you have a sense for what you would need in order for the business to be a little bit more stable financially for you i know where my bills are i know my budget i know you know car payment house payment all that stuff i know what it would take to fund my family's needs so is it like a certain number of retailers or?

31:27More total volume of, you know, total dollar volume of bottles out the door, either in a combination of wholesale or retail, which is why I'm trying to loop in the co-packer and get him going on. And I've taught him the recipes. He's ready to roll. And we should have that scaled up here before too long. I think that'll be game changing for you. You know, back in the very early days of the business, I toggled both a pretty demanding job and also trying to run the business. And to be honest, while I was working full time, it crept along at a really slow pace, both because I was doing the manufacturing and also because I was distracted.

32:06And I think that there was a point in time where I just made the commitment that, okay, this is my number one. It supersedes all else. And so where there is a conflict between this and that, Simple Mills wins. Yeah, I agree. I agree with you on this one, Caitlin. I mean, I think, look, I think you can do a version of both, Tim, right? You can go all in and you can also figure out the most flexible way for you to earn some money, whether that's, you know, Uber or DoorDash or maybe getting a job or part-time job with some flexibility. Because really what you want to be doing is you want to be focused on getting this in the hands of people beyond Lexington, right?

32:52Beyond Winchester, Kentucky. And I think that you really need to focus on just getting people exposed to the brand. I mean, you know, even taking a risk of just sending a bottle, a couple bottles, or at least calling some of these places and saying, can you take some of this on consignment? You know, would you be willing to put this on your shelves. And I think a lot of them, if you will take your call, you call them up and they'd be willing to put your bottle on the shelf. I've got a few of them that are lined up. And it's one of those things where I'm either making stuff for the Saturday market or making it by the case for these.

33:25And so the juggling of who am I going to serve this week is what's been messing with me. We're moving in that direction. It's just how do I juggle that until the co-packer is fully up and going. Yeah, that's one of the things I did. I devoted my Wednesdays to just calling up these places and just being like, okay, hi, I've got this product. Will you take it? I'm going to send you a sample. And then the next week, follow up with them. Hi, did you receive the sample? Can I get the item on the shelf? And just kind of blow it out into as many places as you can, as fast as you can. But to your point, you got to have the product.

34:01And so Coman will be an to unlock on that. Tim, how old is your son? My daughter's 16. He's 15. He'll be 16 in March. I got a job for your son and or daughter. Why don't you sick them on the website? I'm looking at your website. It needs some work. It does. You cannot order the sauce on there. There's off the shelf, very inexpensive software, whether it's Shopify, Squarespace, Square. I mean, there are all these different companies out there, WordPress, that make it really easy. And your 15 or 16-year-old is going to figure out faster than you will. I'm just being honest with you. Sick them on that.

34:43Say, figure this out. Make it easy to order it online. Clean up the website. Make it a little nicer. Just start there. Yeah. We've done a lot of work with recipes, my sauce with somebody else's products, the meats and the stuff from our farmer's market. and he's helping me shoot the recipe videos and stuff like that. So he actually set this mic up for the broadcast today too. So I'm going to let him run with it. And maybe consider being the grumpy dad, making videos, having them put on TikTok. I'm serious. I mean, these guys, 15, 16, they know how to do this stuff. Yep. And you could be the grumpy dad in these videos.

35:21Works for me. Oh, my gosh. And what a great learning experience for him too. Yeah. I want him to be as involved as he can. Yeah, I mean, the question that you ask, right, is, is should I go all in or keep doing it the way I've been doing it? And I think the question I don't think is, should you go all in or not? You should go all in. I mean, you're passionate about this. People are responding to it. You clearly love the process of making this. You've got certified. You've got a brand here. So I don't think the question is should you go all in? I mean, you are kind of all in, right? The question is, how do you sustain a business that, look, let's be realistic here, is probably not going to pay all your bills, let's say, for at least two years, maybe three, maybe five.

36:02So if you can look at this and say, all right, for five years, this thing is not going to pay my bills, but I want to pursue this, and I really think there's potential here. then you kind of reverse engineer it and figure out what you need to do, the minimum you need to pay the bills, but also to really lean in and focus on this thing. Yep, that's true. Tim Taves of Grumpy Dad Sauce Company, thanks so much. Good luck. Thank you for having me. Good luck. Thanks, Ben. I mean, right? You get the grumpy dad on the sofa? Oh my goodness. There are so many things that you could do with that on social media and from a branding perspective.

36:39It's such a brilliant base to build on. I mean, you know, that's something I'd watch. I'd watch a grumpy dad, I don't know, sucking down a bottle of hot sauce. I don't know, something. Yeah, there's something there. All right, we're gonna take another quick break, but we'll be right back with one more caller. Stay with us. I'm Guy Raz, and you're listening to The Advice Line right here on How I Built This Lab.

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39:09Welcome back to the advice line on how I built this lab. I'm Guy Raz and my guest today is Caitlin Smith. She's the founder of the natural food company Simple Mills. Caitlin, what do you say? Should we take another call? Let's do it. Welcome to the advice line. You are on with Caitlin Smith of Simple Mills. Please introduce yourself. Tell us your name, where you're calling from, and a little bit about your business. Hi, Caitlin. Hey, Guy. I'm Marissa Gurdian from Chaffaqua, New York, and my business is Sweet Paws. We are innovating in the pet space with problem-solving, fashion-forward silicone pet essentials.

39:43Our mission is to amplify the joy of pet care and smooth friction in the daily routine so that pet families can enjoy more quality time together. Got it. Okay, Sweet Paws. Welcome to the show, Marissa. Thank you for calling in. Silicone. So what kind of things are they? Like chew toys? So we make everything from chew toys to bath gloves, portable paw towels. We have a couple of things that are just launching, including a bag charm to hold the used bag on the leash. So it's kind of an embarrassment-free solution to walking down the street. Freeze up your hands to do other things. And also our new bag opener that opens the bag on the very first try.

40:20You're talking about the poop bags. That's right. I got you. Okay. So you've got the container for the poop bags, which I know very well because I take my dog for, not just me, my wife, I take our dog for a walk at least once a day. So I'm very familiar with the poop bags. What was the thing you said, the bag opener? So that's our newest product and the one we're most proud of. We just launched it on Chewy. It is our Better Bag bag opener. Okay. And it's a better way to open plastic bags. So have you ever struggled to open a dog waste bag? All the time. It's a pain in the butt. You're trying to open it up.

40:55I'm like ripping it. I'm blowing into it. Yeah. You know, I've got oily fingertips or something like you can't open it. Exactly. I honestly love walking my dog, but I hated opening the bag and it would ruin an otherwise good thing. I would be on my neighbor's lawn. They'd be pulling out of their driveway. I'd be giving them the wave of shame as I just struggled to open that dog waste bag and it could take 20 minutes you know i wasn't going to lick my fingers so um this is a solution that attaches to the leash and it opens the dog waist bag instantly you just insert your fingers you put your fingers it's like a ring i'll show you and i know i'll try to describe it for anyone listening but it's a lightweight silicone device that hangs from the leash okay or your keys or your bag.

41:41You put the two finger grips over the end of the bag and with one simple twist, it opens the bag instantly. You got the silicone finger grips. And then we call it better bag, B-T-R-B-A-G, because it's a better way to open plastic bags. It does it on the very first try. No more licking fingers, no more frustration. You can use this in the grocery store. Those are the worst. I can never open those bags in the grocery store. So that actually leads me to my question because this product we feel has an application well beyond pet. So even though we launched it with a pet company, we started a separate website to show all the other applications, which are not only grocery, but also household trash bags, office bags, any bags.

42:21We even have a customer who used it to separate her coffee filters because she had such a hard time getting those apart. Total pain. And it really does work on the very first try. All right. Before we get to your question, just a couple of questions for you. How did you, tell me about the business. When did you start it and how did it start? So I started the company back in 2020. We got one of the very first pandemic puppies back in March, 2020. And she was a pure delight. We loved her to pieces. Her name is Sobe, mini Labradoodle, but she was very nippy. And so I developed a wearable puppy teether that could be worn as a bracelet so that you always had a chew toy handy if the dog was nippy.

43:01So the human would wear it. The dog wouldn't wear it. It wasn't wearable for the dog. The human wears it. The human wears it. And then the dog chews on the silicone. Exactly. If the dog comes up and is nipping on your wrist, you remove it from your wrist and redirect the dog when they're ready to play. And that way it keeps them from biting you and gives them something else to chew on. Usually they'll just take it. You either tug with them, play fetch, or they'll go off in a corner and chew on this, which is a non-toxic human-grade material, safe enough for human babies. So we pitched it to Chewy.

43:30They had nothing like it. And all of a sudden, we were off to the races. We developed a bigger version, our chunky teether for people with bigger wrists or bigger dogs. And it went into our paw towels and our spa gloves. And, you know, really, we just can't make enough products. We have so many ideas. So you're making a bunch of things now, selling them on Chewy. And give us a sense of your revenue right now. Okay. So we're selling on Chewy, Amazon, Petco, and we're launching with a container store in QVC. Nice. Revenue this year is approaching$200 ,000. I think next year we're going to see a lot more growth.

44:05Hopefully. Thank you. Congrats on that. Okay. And before I forget, what is your question for us today? Okay. So we just launched our Better Bag Bag opener, which I showed you, which is a brand new product that we think is our best product yet. It solves a problem for a lot of people, and it has applications beyond PET. It's easily demonstrable on video. However, we do have limited resources for marketing. In the past, we've tried to do everything at once, and I think that resulted in kind of like a little bit of everything was a lot of nothing. We didn't get results. So this time around, we'd like to focus on one platform to get the word out about Better Bag.

44:43So our question is, if you had to choose just one platform to get the word out about a revolutionary new product, what would it be? Interesting. Okay, Kaylin, I'm going to bring you in here. A lot to unpack. There is a lot to unpack for sure. So I'm curious. So I'm a dog owner myself, although I don't know the dog owner community as well as probably you do. So where do you find that these dog owners, first of all, typically shop? And also where do they typically show up social media wise or online wise? Where are you considering marketing to them? Well, I think we launched this product with Chewy.

45:23That's a really good place to be. And I don't take that for granted. We feel really lucky about that. We've gotten a good response there. But beyond that, probably Facebook, Instagram. My whole list is basically all correct answers of great places to go, TikTok. And that's why it's hard to narrow it down. And I do see this product having reach into grocery for people who have dexterity issues or just the everyday person like me who doesn't like to lick their fingers in public or doesn't want to lick their fingers at all, you know. So those are the people I really want to reach just to kind of educate them that this solution exists to a problem a lot of people have.

45:59Makes perfect sense. Yeah, I mean, I think one of the things we thought about when we had, well, we still don't have the largest marketing budget, but especially in the early days when we had a very, very tiny marketing budget was really spending those dollars as close to the person who's going to buy it as possible. So in our case, we were primarily selling in retail stores. So you think like Whole Foods. And so what we really invested in were demos in store. so we would you know when you're walking through whole foods you get to try a little bit of muffin decide if you want to buy it and then go to checkout now contrast that to let's just use the other end of the spectrum uh which would be like a national ad campaign like a super bowl commercial or something like that you don't want to do that in the early days because it's the percent of people who are seeing that that are actually going to go and buy it or maybe it's or even are going to visit the store that the product's in, super low.

46:58And so when I think about your product, I think about, well, how do you get as close to those customers that are already, for example, on the Chewy site looking for products as possible? It's a little bit different because it's primarily online. But I think the premise probably still applies. Yeah. I mean, I think it's a tricky answer to a very good question, right? Which is where do you put your – And the obvious answer that I think a lot of people would sort of give you is you pick a social media platform that works best for you. And by the way, where have you performed the best? What platforms work best for you?

47:33I would say, honestly, we haven't done a good job of marketing. So when we leave it to our partners, our retail partners, they're very well equipped to do this on behalf of our products. And part of our arrangement with them, I think 20 % of our payment from Chewy goes back to them as a rebate for marketing. So I see it show up on my own feed for Instagram, my own products show up and stuff. But when we do it ourselves, like I said, it's almost like we spread ourselves too thin because we don't have enough resources to devote to it. And I haven't seen a great return. That's kind of discouraging, I would say, which is why this time we want to take a different approach and try to put all our eggs in one basket and try to have a bigger impact with that one platform.

48:15Give me a sense of how much money you'd be able to spend on this. Like$5 ,000,$10 ,000,$20 ,000? I would say about$5 ,000 to$8 ,000. All right. So you've got basically a very small budget. And you're right. I mean, every person, Caitlin, you guys may be experiencing the same thing. Customer acquisition over social media has really dropped, especially since the pandemic. Have you found that to be the case? Oh, 100%. Yeah. And it's expensive. And here's a thought for you. I, you know, because there's, of course, there's influencer marketing and finding the pet owners, and that's certainly worthwhile.

48:54But$5 ,000 to$8 ,000, you know, you really want to see how far you can stretch that. And I wonder whether it's worth looking, and it's going to sound very self-interested, right, because of what we're doing here. And I'm not saying our show because we don't do this anyway, but there have to be podcasts that have 10 ,000 to 50 ,000 listeners a week, let's say, that are pet podcasts. There have to be. I mean, I don't know off the top of my head. But there's an intimacy when the host of that show, we do advertising on this show, when I talk about a product that I use, when they talk about products that they use, especially if it's to a very, very specific kind of audience, that could have a pretty big impact.

49:45You know, we did an episode of the show a couple months ago about Bull and Branch. I don't know if you heard that episode. I did. It was a great episode. The betting, right? And I love how they're a married couple and they get along so well. And they're awesome. Scott and Missy Tannen. And if you remember that episode, they did something really, really risky. I mean, they took a million dollars. They took out SBA loans. They took out a mortgage on their home to buy advertising, 18 months of advertising on the Howard Stern Show. And I think the minimum buy was a million dollars. It's an insane thing to do.

50:18Totally crazy. It was at the beginning of their company, but they really, they put all their eggs in that basket. It was very risky, But it wasn't if you think about it because people love Howard Stern. People love Joe Rogan. Whoever – there are different people connect with different people in different ways. Alex Cooper of Call Her Daddy. So there's something about a person and they don't have to be super famous. But if you listen to that person and you trust them and they're talking about something that could be useful for them, it could have a huge impact. I mean, that Howard Stern ads that they took out eventually turned Bull and Branch into a huge brand, which it is today.

50:57So it may be worth exploring podcasts that focus on pets and pet care. That's a fantastic idea. I love that idea. The other thing I'm thinking about, too, is really that kind of lifetime value for your customers as well. And so how much you're willing to pay for each person that you're bringing into the loop. not spending too, too much on each person or each individual that you're acquiring so that you're able to be profitable on the items too. And so are there vehicles within Chewy that you can market on? Maybe it's similar items in a sponsored way. Okay, customers who bought this might also like this item.

51:40And then you're a lot easier getting people to add that item to their cart. That makes a lot of sense. And they do encourage vendors to support their in-house campaigns. And I think going back to what you said about finding people where they already are, maybe I should think more carefully about that. That might be a better strategy than starting from scratch on the internet and trying to find people out of nowhere. But I also love Guy's suggestion too. I have to tell you, I can't tell you how many people have told me that they heard about us on how I built this. And so it is a fantastic marketing vehicle.

52:13Yeah, especially if you can find, you know, and it doesn't have to be a podcast. It could be a great blog or a sub stack or something. But where you've got, you know, somebody who really has between 10 and 50 ,000 people who are regularly consuming their content, the cost for that ad spend is going to be very low. So you may want to kind of experiment. Take that 5 ,000 to 8 ,000. Don't blow it all in one show, but take a little bit of it and see how far that gets you. Those are great suggestions. I would have never thought of that, honestly. So thank you so much. Cool. Mercer Gurdian, the brand is called Sweet Paws.

52:52Good luck. Congrats. We'll be following you. Thank you. Such a pleasure to meet you both. Nice to meet you. By the way, the other problem I have is that I only bring, I shouldn't say I, My wife only, she has always one poop bag tied to the leash. We don't have like a good case. But you know what's so great is that in our town, there's like every, you know, half a mile or something. There's like a dispenser. Doggy bag station. Yeah, doggy bag station. Great idea. I am wholly reliant on those. Totally. Saved many a sneaker. It really has. Because you don't step and poop. It really has. Yeah. Yeah, I'm very forgetful with the bags.

53:34Yeah, totally. Caitlin, before we let you go, I want to ask you one last question about your journey, because now it's been a decade, more than a decade since you started. If you were to go back and sort of visit yourself in that, making stuff in your kitchen, and you could say, hey, I'm coming from 12 years in the future here. Here's what I'm going to tell you. What might you tell that Caitlin Smith? aside from do it and run faster uh i think that i think the other one just relates back to learning uh one of the greatest parts about being an entrepreneur and building a a growing business is that you get to learn so much and so to lean into that not feel like you have to have all the answers i think in the early days i felt like i needed to i needed to know the answer to everything And the fact is you don't.

54:30And there are people for that. But also, if you're open to learning, if you're really going out there and seeking that education, then you'll get there a lot faster. Yeah, that's awesome advice. That's Caitlin Smith, founder and CEO of Simple Mills. Caitlin, thanks so much for coming back onto the show. Thank you for having me. Great to see you. And by the way, if you haven't heard Caitlin's original How I Built This episode, you've got to go back and give it a listen. You'll find a link to it in the podcast description. And here is one of my favorite moments from that interview. The weekends where I wasn't going to production runs, I was doing demos in the stores.

55:07And so my rule of thumb was if it was a three-hour demo, I needed to bake for three hours in order to make enough muffins for the demo. How many muffins would that be for three hours? I would guess somewhere around like 600. $600. Oh, my God. Right, because somebody would come up and say, oh, let me just take one for my husband. He's over in the dairy aisle. Or the best is the kids that are unsupervised. And they would just eat them. They'd just shove them in their mouths. Steal them off the table. Like, you're not supposed to give them to a child who's unsupervised, but sometimes the child takes it and runs.

55:40I also want to share that just this month, Simple Mills announced plans to be acquired by Flowers Foods for almost$800 million. Caitlin will continue to lead the brand. And if the name of that company, Flower Foods, sounds familiar, it's because they also acquired another H-I-B-T alum, Dave's Killer Bread. Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at GuyRoz.com or on Substack. And of course, if you're working on a business and you'd like to be on this show, send us a one minute message that tells us a little bit about your business and the questions or issues you are currently facing, because we would love to try and help you solve them.

56:26You can send us a voice memo at hibt at id.wondery.com or call us at 1-800-433-1298. You can leave a message there and make sure to tell us how to reach you. And by the way, we'll put all of this in the podcast description as well. This episode was produced by J.C. Howard with music composed by Ramteen Arablui. It was edited by John Isabella. Our audio engineer was Sina Lafredo. Our production team also includes Alex Chung, Carla Estevez, Elaine Coates, Chris Messini, Catherine Seifer, Carrie Thompson, Sam Paulson, Devin Schwartz, and Neva Grant. I'm Guy Raz, and you've been listening to The Advice Line on How I Built This Lab.

57:07If you like How I Built This, you can listen early and ad-free right now by joining Wondery Plus in the Wondery app or on Apple Podcasts. Prime members can listen ad-free on Amazon Music. Before you go, tell us about yourself by filling out a short survey at wondery.com slash survey.