Lenny & Larry’s Protein Snacks: Barry Turner

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28:07Hey, welcome back to How I Built This. I'm Guy Raz. So it's 1993, and Barry and his friend Benny are sitting at a cafe in L.A. where they've just come up with the idea to start a business selling protein muffins. There was no turning back, Guy. It was just, we're going to do this. We didn't know how we're going to do this. No consumer product good experience. There's no marketing experience. There's no business experience, nothing. And we just, we knew that day that was it. And so we didn't leave that table until we drew out what we thought the logo was going to look like. And we left there and went straight to a little natural food store, Rainbow Acres, and picked up some protein powder.

28:53We bought some muffin mix, went back to my kitchen and started baking these muffins within two hours. We opened up a bank account that day with$1 ,400. I don't know why it was$1 ,400. Maybe that's all we had. And we did a DBA doing business as. So this all happened the very first day. And the business was going to be called what? Lenny and Larry's. You decided it right then and there, you're going to call it Lenny and Larry's? Right then. Even though you were Benny and Barry. Yep. We always called each other something different. Again, something goofy. Our names would change every day. It was just something stupid we did.

29:29And so we wanted to create these characters. And we said Benny and Barry sound like real people. Lenny and Larry sounds like two characters. And that was it. I think people overthink things now that I look back on this. I think people overthink trying to get the perfect name or the perfect design or whatever rather than just doing it. All right. So it's going to be Lenny and Larry's. Yeah. And what – when you guys were talking about this in that initial, did you say a snack food brand or did you say let's just make baked goods or what do you remember? Yeah, we were thinking we're going to put protein in everything.

30:08Just protein powder, like whey powder. Yeah, whey powder is going to go in, cookies, muffins, brownies. We started crazy ideas of popcorns and granolas. We're thinking of everything we can put protein in. What did you guys do? Just got like muffin mix and like from the grocery store? That's all we did. Apple cinnamon, muffin mix, and some whey protein. Seems simple enough. Seems simple. You take out some of the flour and you replace it with protein and it's got to work, right? Of course. And? And it did not. The muffins actually baked, but they were hard as a rock. And we weren't discouraged. We go, we can find somebody that can do this.

30:50That's what we kept saying. We knew it wasn't out there, but we said we can do this. So we find a bakery in Santa Monica called Montana Bakery, small little bakery, and said, hey, here's what we're going to do. Can you guys help us? We said we just need help putting these recipes together. Did you know the owners of the bakery? We didn't. We met them, and they were just two brothers. So we just struck up a friendship, and they started baking muffins for us. So they agreed to help you figure this out. And what you said to them, look, what did you say to them? Well, we just said we're trying to get a certain amount of protein in these muffins.

31:25We didn't want to really use refined sugars. We wanted to use something healthier. Now, we're already thinking about how healthy these things can be. So we're thinking we want to use like a fruit juice concentrate in place of sugar. So we're just, you know, we're thinking even further down the road than just making protein muffins. And by the way, in those early days, what were you using for protein in the muffin? We started with whey, and that was our protein source initially. And what happened, the muffins tasted great. They just wouldn't have a crazy good shelf life. And they started to bind up.

32:00They started to get a little harder over just too soon. But we did actually. We launched with whey protein muffins. Okay, so this bakery did make, they came up with a formulation. Yep. And the plan was, you guys bake these muffins for us, and then we're going to take them off your hands and do what with them? we're going to go sell them. We had no idea who we were going to sell them to, but we knew we could sell these. And our first, it's funny, our first account was the coffee shop. We dreamed up the idea. That coffee shop in Brando, right? Yeah. Yeah. She said, Joni. And Joni goes, she goes, yeah, I'll give you a shot.

32:36And I can remember a guy, our first invoice, we were selling these muffins for like$1.20 a piece. And our first invoice for our business was$13.20. That was the first invoice we ever issued. And so they would just sell them like in their display case. Yeah, they put them right by the register. We were big. I don't know why. We were always big about, hey, if we'll – if you could put these by the register, that'd be great. And how many – and then presumably also going to some other coffee places or did you try gyms? We did. We did Rainbow Acres, natural food store here locally, and we did Gold's Gym in Venice.

33:12and we did a local health food store called Mrs. Gooch's. Oh, yeah, which was eventually bought by Whole Foods. And so how long was the shelf life for the muffins? Probably like four days or something like that. And it wasn't packaged. Was it packaged? Yeah, it was packaged. We had them in like a plastic wrapper and then we had a sticker. We had a label, like a label sticker put on top of it. So you would hand package them yourselves. We would hand package them ourselves, correct. We had a machine. Muffins from the bakery. Muffins from the bakery. We would sit there at night with our little crimping thing and we would crimp.

33:43You basically put the package into the crimping machine, crimp it, it would seal it, and then you'd slap a sticker on it. Slap a sticker on it, yep. And what was the flavor of the muffin? We did apple cinnamon, we did blueberry, and we did a lemon raspberry. Those were our three flavors. And how much protein in each muffin? I think back then around 15 grams. Wow. Yeah. So this is early 90s. This is like really before the protein revolution, which is – we're going to get to it because it's – I would argue just starting now. And only now are you really seeing an explosion in protein, protein, protein everywhere.

34:19At the time, who did you think was going to buy these? I'm assuming you thought it was going to be like bodybuilder types. We did. But to be honest with you, we really were developing these, we said, for the average consumer. We thought if we could make a – we coined a term later called better bad. But at that time, we thought if we could get them to stop eating Little Debbie's or Chips Ahoy and come to this. Because we thought bodybuilders would enjoy it as like a little cheat treat. But we were really targeting the average consumer. So the idea that you were thinking was, hey, maybe we could – if we pitch this as a healthier for you muffin because there's protein and – but there's still this sugar in it.

35:02There were still carbs in it, but people didn't care about it that much. No. But you thought, okay, if we can get people to think, okay, protein, fiber. Was fiber something? It was. Yeah, we started it. We had added fiber already to that product, yeah. And they tasted as good. They tasted fantastic. People talk about it to this day. They go, that's still the best product you guys ever made was your protein muffin. Wow. Yeah. All right. But now this is a small business. I mean, this is like a tiny business. You're going, I mean, you were selling$15,$20,$30,$50 worth of muffins at this coffee shop and that coffee shop and trying to collect that.

35:38I mean, that's a tough business. Listen, we weren't even small. We would have taken small. We were smaller than small. It was just a crazy little idea that we were so determined to make it successful. So tell me a little bit about what a typical day was like. Was the, okay, you were not baking the muffins. You had this bakery making the muffins initially. So I had to bring in some money. So I was doing some personal training at Gold's Gym in Venice. I had clients. My wife was a personal trainer. I met her at Gold's Gym in Venice. Okay. You were married. This is your – This is my second wife, the one I've been with now for over 30 years, Cheryl Sandy.

36:18She was a personal trainer. I was a personal trainer. And we had just had one son at the time. And we would just trade off. Like she would go to the gym. I'd watch my son. She would come home. We'd swap off. I'd run to the gym. They'd go to the bakery and package muffins or whatever had to be done. And were you presumably driving the muffins to every little location that was selling them? Absolutely. We delivered. We'd get up at 3 or 4 o 'clock in the morning, go deliver them around town just so I could be back to the gym by 7, maybe to train a client. I mean it was crazy. It was just like – I don't know.

36:51I never – you're driving around a car at 4 o 'clock in the morning in L.A. or even sometimes down to Anaheim just to deliver a bunch of muffins. Buffins. And it was just you and Benny. Just me and Benny. So I would think in like that first year, maybe you do$10 ,000,$15 ,000. Maybe. But it's exciting. It felt exciting. Yes. To know that where you're spending X amount of dollars, you're bringing in Y amount of dollars at the end of day, you're like, hey, we've got money left over every freaking week. This is incredible. We're making money. Okay. But the formulation still is a challenge, right? It's still a challenge.

37:31Yeah. You're not getting a lot of shelf life. And I guess this starts to change when you meet a guy who is a retired baker, a guy named Len Hoffman. Who's Len Hoffman? Len Hoffman was a retired baker from Entenmann's Bakery. And our business had started growing. So we outgrew the Little Bakery in Montana and we ended up baking at a bakery in the Valley, Green's Bakery. It was a little bit bigger. In the San Fernando Valley. Correct. But Len Hoffman was friends with the owner of that, and we told Len what we were doing, and the first thing he said, he goes, stop calling these recipes. He goes, these are formulas.

38:07And I was like, okay. He goes, this is scientific now, boys. So we're like, okay. So we get Len to start helping us with these products that we're working on, and we're also starting to do some private label for a pretty large coffee chain here in Southern California. Private label, meaning they were not Lenny Larry's. They were just selling it as their protein muffins. Yeah. It's called the coffee bean and tea leaf. Sure. And how many coffee bean and tea leaves were there? At that time, there were over 100. Wow. And you were servicing all of them? All of them through their distribution center.

38:42So you got a contract with them. Correct. We were selling our products to some of their independent stores. And they're like, well, hey, I wonder what else these guys do. So they ask us about doing some scones. and we told him we made the best scones in the city. Which was not a total lie. Which was not true. You did not even make scones. Guy, we didn't even know what the hell a scone was. Or a scone, if you're in certain parts of the world. So somebody said, hey, listen, for you two rednecks, that's a biscuit with fruit in it. And we said, okay, we can make that. And so that was one of the first products that Len Hoffman actually helped us with.

39:15It was reduced fat. I don't know why at that time they were doing these reduced fat scones, but that's what they wanted. Not protein scones. Not protein, just reduced fat. Reduced fat, okay. So we saw an opportunity and we made these amazing scones and it quickly became their number one selling product. Wow. And because the scones were such a success at Coffee Bean, what do you think they said? What else do you guys do? Yes, and you said? What do you need? Because now we saw opportunity there. We're like, okay, if we get this private label business going, we can use that money and help to grow our brand.

39:48So they wanted some new cheesecakes. So we started doing that for them. And then they asked us about if we could do things like Bundt cakes. And the answer was always, yes, we can do this. We can do this. But again, not protein. These are not protein products. These aren't protein products for them. But then when we started showing them protein products like high-protein cinnamon rolls, they were like, okay, this is interesting. So we started selling them some of our newest protein inventions. But this is not Lenny and Larry's. This is coffee and tea leaf. This is their product. This was a chance to actually – we're actually making money now.

40:24And it got to the point where we ended up – we were delivering pallets of product to their distribution center. The business was booming so much on the private label side. We had to go buy a big truck to deliver it seven days a week. We were dropping off product. Wow. So this was – you guys are bringing in – Like$400 ,000,$500 ,000 a year. Now it's starting to make some good money. But you're not building your brand. Not building your brand. Still working it behind the scenes. Don't get me wrong. We did not give up on it. Our day was spent like – we just kept opening up more and more accounts locally.

40:58Started getting some independent 7-Elevens that could actually take product without the approval of the corporate office. Just the muffins though. Just the muffins, yeah. And then we started developing more products. We started – we came up with a brownie, high-protein brownie at the time. We came up with a high-protein cookie. And we still know we're on to something. then things uh things change one afternoon so which was which was uh benny was delivering product uh to coffee bean and i got a call uh he got rushed to the hospital he had a deviated septum so he had a surgery done and they had lanced an artery didn't know it at the time so he bent over was picking up something and blood just starts gushing oh jesus so he gets rushed the hospital, almost dies.

41:47He realizes he wants to leave California and go back to Georgia and be around his family. So we tried to manage this, we'll call it as an East Coast, West Coast business, but 99 % of our business was on the West Coast. Let me just pause for a sec, because I know, I know that, I guess this is around 2000 when he moves, but I think, you know, most of your business probably 95 percent of your business was coffee bean and tea leaf right yeah yeah and benny has this kind of life-changing experience he decides he wants to go to georgia and you you're going to run the business bi-coastal but that's hard especially in the sort of the pre internet pre zoom era yeah and that meant that you were probably delivering all the product and dealing with all the, you know, the, you know, billing and collection and all that stuff.

42:41And he probably wasn't able to do that much that way. No, at that time we were, it wasn't big enough to do East Coast, West Coast. So basically doing 99 % of the work for half the money. Yeah. And it does, again, went along to figure that out. That's not, that's not a good model. And so you want to change. So what do you do? You say either I buy you out or we sell the business. So we put the business up for sale. In 2001. 2001. And who was the buyer? Don Crouch and Jim Felder. They were two friends. And who were they? They were just two local guys that lived in the valley. And they saw potential in this business as a white label?

43:24As a white label, yeah. Yeah, they liked the brand, but they thought the white label business, they could turn it into something. Yeah, and roughly what did they pay for it in 2001? They paid$480 ,000. So not ideal, but not bad. Yeah, not bad. At least we made money along the way. We created something that had value, and it was kind of cool that you could sell a business for almost a half a million dollars that you created from just an idea. Yeah. And they got those accounts, though. They were going to continue to talk to me. They got everything. Yeah, they got everything. How did you feel about that?

44:03Was it – did it feel like a relief? You know, Benny's gone and – No, it's just a, again, regret that I should have just bought him out. And then Don and I were sent in the parking lot talking after we had done our deal. And Don said, you and I should have just partnered on this. I said, I 100 percent agree. and uh so don and i remained friends uh as he as he owned the business they actually paid me to really kind of manage the coffee bean account because they knew how valuable it was and i had a great relationship with coffee bean do you remember feeling similarly to how you felt when you were out of american gladiator when you yes injured yourself yeah yeah yeah like like something ended that you just didn't want it to end.

44:48I still had the passion for my brand. And it was like, it was just kind of like giving it away and never watching it, never giving it a chance to grow up. It was six and a half years. Six and a half years. Yeah. Somebody asked me one time, what did you, what did that six and a half years cost you? I said, it just cost me time because it came down to being very scattered and not having what I call a hero product. We had all these products that we can make, but none of them were the one where you just went to. Yeah, this is our calling card. This is what we're going to be known for. You never focused on like, this is the thing that only we make and only we can make it great.

45:30Yeah, we made too much stuff to really focus on one that could be a winner. Now, we still had our brand, but like I said, it was the majority of our business was Coffee Bean. And nobody knew your? Nobody knew the brand. No. Locally, you did. Like we would have – Magic Johnson was a big fan of our brand back in the day when he was still playing with the Lakers and he would see our product. He'd always buy it at Gold's Gym and somebody would say, hey, Magic, that's Lenny and Larry. He would always – he would stop and say, oh, man, I really love your product. So we had those types of things where we had people that knew us in L.A., but nowhere else.

46:04So when that ends, you're 40. Yeah, 2001. Yeah. And one kid or two? Yeah, two from our previous marriage, two daughters, and then my two sons. I had four kids at that time. Right. So there's a lot on your plate. I mean, that's no joke. Yeah, true. So, all right. So you are out of Lenny and Larry's. Yeah. And then I guess over the next few years, you do a bunch of different things. Like you go to real estate. I think you even made some money, right? I mean, you got out before the bust. Yeah, I did well, actually. Yeah. And then I read that you did some work, like you went to work for a software company for a while.

46:47Well, that's an interesting story there. So one of my good friends, Michael Vinny, he was working with these guys in the software business, and they wanted to meet me. I meet these guys, and they've got this little software company they're doing, and it's kind of computer monitoring software. And so they asked me one day if I would like to join them, and I was like, well, in what capacity? What do I know about software, right? And they said, we don't know. We said, we just think that you could, maybe you'll run our company one day. And I was like, okay. So I hung out with these guys. I call it hanging out with them.

47:18They were paying me to hang out with them. And it's just, you know, I'm learning, I'm learning about the software business, but I'm also learning how to market online direct to consumer. And so after a year of being there, they said, we'd like to make you president of our company and let you run our company. And so I'm running the software company called Awareness Technologies. and we're selling computer monitoring software. Now, this is at the height of like the NBC show, Catch a Predator. So we're working with law enforcement agencies, schools, parents, et cetera, because the software captured everything, every keystroke, every email, every website visited.

47:57And we were doing great. I mean, this thing was catching fire. But I was looking at this, I'm just like, well, if I could do this with software, imagine what I could do with, if I have my old company back. I could sell direct consumer snacks. And it was just kind of putting it out there in the universe. And that's when Don Crouch reached out to me and said, I need help. I'm about to shut this thing down. He calls you, says, I'm going to shut this thing down that I bought from you. Because he said, I don't know what I can do with this. I don't know where I can go with this anymore. Was he still supplying coffee beans?

48:33Still supplying coffee beans. And he had a little bit of other private label stuff he was doing locally. and he said, I'm about to shut this thing down. Would you ever consider coming back? So we did some quick negotiations and I said, yeah, I'll just throw caution to the wind here. I'm in. He said, well, you want to come back. You want to come back, be a 50-50 partner with me. 50-50 partner? Yep. And did you have to buy some of it back? Yeah, it was very cheap. Low. It was a low. Okay, so you were able to buy 50 % of the company back. and basically be the partner again. What was, I mean, I'm just, it's going to sound like a sort of a dumb question, but I'm teeing you up for her.

49:17But I'm curious in your mind, what was exciting about that prospect? I mean, you would, you left six years earlier. You've not been involved for six years. Yeah. What was exciting about coming back to this thing? Now I got to do what I wanted to do from the very beginning, which was build this brand. Money didn't excite me. building my brand excited me. I wasn't scared at all. I got my baby back.

49:47When we come back in just a moment, Barry has the second worst day of his life. Stay with us. I'm Guy Raz and you're listening to How I Built This.

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52:18Individual responses may vary.

52:26Hey, welcome back to How I Built This. I'm Guy Raz. So it's 2007 and Barry's bought back half of Lenny & Larry's from its current owner, Don Crouch. I wasn't scared at all. I love going back into the unknown, but I was so confident that I could turn this into what I originally thought Lenny & Larry's could be, which was a brand. and a funny story i walked in the office the first day we had a small little office on uh in encino on ventura boulevard and jokingly to don i just said okay i said sit down shut up and watch what i'm about to do and we had a big laugh about that right but i coming from my experience working in the software company and working with these guys who were very brilliant guys by the way in terms of marketing.

53:16I felt like I could launch the first direct consumer snack food company that was, you know, kind of a protein fiber, all natural. I felt like that's what I was going to do. And so the first product I wanted to launch was a high protein brownie because everyone was doing protein bars at the time and no one had done a brownie. Let's talk about building the brand. First of all, you didn't have a – you need a logo. You need packaging. You needed to get it into shops. I mean you had the muffins in some – a few places. So let's talk about first of all the logo. Okay. Because I don't know if everybody knows what this looks like.

53:54But today it looks like two crazy dudes with like clown hair on this. That's the logo. Yeah, that's the logo. Lenny and Larry's. Yeah, and our original logo was mine and Benny's actual faces, our hair. That was original. It was like a real photo. But when I came back, the first thing I said I'm going to do is I'm going to create a caricature. It can't be a photo anymore. So we created a caricature of the logo. It's basically a giant Afro with two heads stuck in it. That's what it became. Two heads and I always say one head of hair. One head of hair. Yeah. And you're going to come out with your own product, Lenny and Larry's, in shops.

54:33and it's going to be a brownie. It's going to be a brownie. And so we find someone to manufacture the brownie. We designed the film, everything. We ordered 72 ,000 brownies, 36 ,000 of two flavors, had those shipped to a warehouse that we rented. And we're sitting there with 72 ,000 brownies and said, now we have to go sell these. You do not have any commitments? Nope, not a single commitment. And how long would these brownies last? Oh, they would last 15 months easily. Oh, okay. Yeah, these have a really good shelf life, yeah. So how did you sell them? First thing we walked into the Whole Foods office in Sherman Oaks.

55:16Did you have a connection there? Well, we did. I didn't know who was working there. We just showed up at the office one day and see one of my former buyers. She walks in. She goes, I remember you. And I said, I remember you. And she said, what do you have? And I showed her. She goes, I love this. Let's put it in. Wow. That's it. That's it. By the way, how much protein in each brownie? 20, 20 grams. 20 grams. And to be clear, you did not – sugar was not an issue. You weren't worried about sugar and carbs, right? Nope. I felt like – again, I'm still catering to the masses and not the bodybuilder fitness people.

55:49Yeah. I always said if I could be in two retailers at a time, it would be 7-Eleven and Walmart. That's the only group I wanted to sell to. And not to minimize what this product was and how innovative it was, but basically it was a sweet sugary brownie but with a lot of protein. Correct. It was basically a protein bar, but it tastes like a brownie in the shape of kind of a square, so it had to be different there too. All right. But 2008, I mean, this is super innovative. Nobody's making a protein brownie. Nobody's making a protein brownie. So you get into a few Whole Foods in the L.A. area? Yeah.

56:22Actually, yeah, the L.A. area. And then it just snowballed from there. and GNC accepted it, Vitamin Shoppe accepted it. Then we said, okay, now we're onto something. And all the while though, we had a little product. I don't want to jump ahead, but there was a little product. It was a cookie. It had a label on it and it had a little, like a sheet in the back that you could print our nutritionals on. And we sold that locally to 7-Elevens and a lot of office buildings and stuff like that. This is a protein cookie. Correct, but it didn't have a great shelf life. And it had a clear package. You could see the package and light oxygen and can destroy it, but it had a couple weeks shelf life.

56:57And we remember a call we had with Vitamin Shoppe. And Vitamin Shoppe said, if you could get a shelf life on your cookie, we would take that also. And I went, okay. Because how long did the cookie last? A couple of weeks. And that was because of the packaging? Yeah, because of the packaging. Yeah, because of the packaging. And so I had the light bulb moment again. I was like, I got to design a film for that cookie. And we did. Then, I would say the rest is history, but the cookie just became an absolute monster. I wanted – like, again, I was creating – I wasn't creating a low-sugar, low-carb product.

57:38I was creating a freaking cookie. It had flour. It had sugar. It had – Everything. 400 calories. It became popular with college kids, construction workers, teachers. people that could say for a buck 99 i get this giant cookie it's very filling i can grab i'll grab my red bull and i'll grab a linearist cookie i mean one cookie i'm looking at today i think it's probably similar 10 grams of fiber yeah 16 grams of protein but you know 26 grams of sugar yeah but but i guess you just were like maybe people can choose this it's marginally better than an Oreo or a Twinkie. That was it. That was everything.

58:19I want to create a better bad. I want people to make a better choice. And nobody's going to go from eating a, you know, a little Debbie to eating some sort of protein bar. It just, there has to be something, there has to be a stop in the middle. Yeah. What do the cookie retail for? Retail from anywhere from like$1.99 to$2.49, that range. And how much did it cost to make? Less than 50 cents. Wow. For about 40 cents. That's like a LVMH bag. Yeah. It's like making a Gucci bag. It costs them like 160 bucks. They sell them for like 3 ,000. Yeah. We weren't shy about making a profit. What we liked about it is that we never had to raise money.

58:59We never had investors. Never had debt. So, okay. So, by 2014, are you still primarily in California only? No, we're everywhere at that time. We're really starting to take off. 2014, we're about doing about 11 million in revenue. So you hit$11 million in sales by 2014. Yeah. Purely or mainly on the strength of the cookies, not the muscle brownies. No, the muscle brownie was still there, but the cookie is the one that just literally caught fire. Why do you think that is? I think the answer is just because cookies are a much bigger, more popular snack than brownies. Well, that's it. And a brownie is considered a decadent treat.

59:43It's not something you would eat every day. You'd eat a cookie every day. Even though like nutritionally, they're pretty similar. Yes, exactly. But it's funny, guy, when we talk about like, when we talk about sugar and carbs and all this nutrition and stuff, you and I are still in the minority of that world. The rest of the country is still trying to make a better choice, but they're not going to make an extreme choice. so people still want to have their cake and eat it too. They'll sacrifice something in order to eat something that's just a little bit less bad that has some nutritional benefits to them.

1:00:20I completely agree with that. I think that's exactly right. I think that just as a tiny number of people care about sugar and carbs, I think most people, you're right. If they see protein, fiber, they're good. They're not worried about the carbs or the sugar. Okay, so you're just growing like hockey sticks. Hockey sticking. So, all right. I guess around 2015, you are at a trade show. Yep. And you guys are a hot ticket there, right? Hot. Yep. We just finished, I think it's 2014, at$11 million. And we're going to grow probably to$18 million or something the next year, whatever, in 2015. But I got introduced to a gentleman named Nick Gianuzzi.

1:01:06And Nick is an incredible attorney. He represents pretty much every CPG brand that's been sold. He's always represented them. Nick pulled me aside and just said, I love your brand. He goes jokingly. He just said, stop effing around and start doubling your revenue. And you're going to get noticed. And I was like, okay. It inspired me to want to really turbocharge my sales. So we went from$11 to$27 million in one year by opening up accounts and actually managing, servicing the accounts we already had. How many employees did you have? 2014, 2015, we may have had seven. God, with$27 million coming in?

1:01:49That's an efficient business. And that's the only way we knew how to do it. I never believed in hiring when you didn't have to hire. I believe in paying your people more money that are there. And we had a great small little ragtag team. And from there,$27 million turned into$94 million in revenue the next year. By 2016? By 2016. And what percentage of that do you think was the cookies? Probably 90%. Were you worried at all that this was not going to last, that you would have competitors coming in? I mean, in other words, did you think like we better really make a bunch of snacks because otherwise we're just going to get General Mills or Nabisco is going to come in and do this?

1:02:34I'll be 100 percent honest with you. I have never in my life worried about a competitor, a so-called competitor. And that's not being cocky. It's just like if I'm worried about what someone else is doing, then I'm not worried about what I'm doing. So I didn't care what you were doing. I was building a brand, but I thought a bunch of other things along that journey that could have destroyed my business. Like what? Well, one was an issue with one of our manufacturers. I got a call from one of our retailers in Florida that said, hey, we're starting to see these little – we'll call them little bugs.

1:03:08They're in a cookie. No kidding. Like a little – and they're called meal moths. So they get in flour. Like flour has been sitting for a long time, whatever. Oh, yes. I've seen that. I've had that. Okay. So have that happened with a retailer. And now social media is out there. And the first thing people do is they want to start posting. You're just, oh, yeah, yeah. And I had to take that on myself. I literally post. I was doing our own social media at the time. And I actually posted my own phone number and just said, anyone who gets it. I said, I'll trust me. I said, I'm going to handle this. I'm going to apologize to everyone or whatever.

1:03:43And it was real quick. We were able to isolate it real quick because it was one flavor and we knew the actual group that actually made it. So we were able to isolate and pull all that product. But anything to damage your reputation, it just makes you – you don't sleep at night. Yeah, for sure.

1:04:27general most type companies will say big companies big companies are coming for you they're asking about you they're they want to buy your company and we had 28 interested parties right out of the gate and then i'm like shit pardon my french but the uh we had just moved in this beautiful warehouse office i was just just just starting to enjoy this i didn't really want to sell and then you're starting to field like some big offers for your business and you accept an offer from a group called Lion Capital. Correct. First of all, I'm curious, was there an option to go to get acquired by a big food brand?

1:05:04There were a couple at the table and they had made offers. And I'm just being honest with you, if I was going to sell it, I was going to sell it to the highest bidder. Highest bidder, that was it. All right, so they were the highest bidder and they acquired you for, I think it was a mixture of cash and equity, right? Yeah, so they bought, end up buying 75 % of the business. And at the time, now you understand this is seven years ago. So if you're equating it to the value of today. So at the time we were valued at$250 million. Not bad. And so we sold 75 % of the business. And it was just because how our business was structured, we were an S Corp.

1:05:45It had some value to them. And so Nick Giannuzzi, who I mentioned earlier, he represented us, he was our attorney. And he told us point blank, he said, don't expect to get the second bite of the apple. You mean they were going to just hold on to it forever? Exactly. And exactly what they've done. All right. So this begins a period of what you're still in today. And they're not on this in this interview. So I want to be careful and mindful and respectful of them. So I'm going to play the part of defending them a little bit here. But you are still in a situation where you own still a chunk of the business.

1:06:18Correct. And technically you're on the board, right? I'm on the board, yeah. Okay. But when you left. or when they bought you out, they replaced you with a new CEO, right? Correct. You said that the first time you sold it, 2001, was the worst day of your life. Terrible. When you sold it for the second time, you say it was the second worst day of my life. Yep. I still live by that. I miss my people more than anything. These are my team members. These are people that helped me grow this business. So, yeah, to this day, I wish I never would have sold my company. Okay. So while you're the company, okay, they take it over, you're out as the CEO, but you're still an advisor ostensibly.

1:07:01Yep. But, and look, I see Lenny and Larry's everywhere. Every time I go to Whole Foods, I see it everywhere. It's a, that logo just pops. I see those, that Afro. So I'm under the impression that things are swimming, are great, going great. You have a different view here. You are not happy with how it shook out. You're not happy with the current owners of the brand. Not at all. I have no problem saying that. We're not each other's cup of tea. And it's just bad decision after bad decision, bad hire after bad hire. They hired, this is no lie, within six months of selling the company to them, we went from 17 employees to 59 employees.

1:07:42The business didn't triple. They only grow the business about 6 % to 8 % a year if that. They destroyed profitability. I felt like I handed them a Ferrari and they turned it into a Ford Taurus. But what would the – I mean, listen, I'm looking at their portfolio. This is clearly a sophisticated group. I mean, they own kettle chips. That's just in food. But they own beverage and hospitality and jewelry and licensing, personal care. I mean, clearly they've made a bunch of cash in different places. Like there's no question in my mind. I think you're being nice by saying sophisticated. Okay. They would never have had me stayed in that chair because they used a term one time.

1:08:20It always rubbed me the wrong way. After they bought the company, they said, we need to professionalize the management in this company. And that means we weren't professional enough in their eyes. Then you fast forward about four or five years later, they go, we got to go back to being an entrepreneurial brand. Well, that's what we were. That's what we always were. It was an entrepreneurial brand. And they never really embraced it because they had to come in. They had to show, we know what we're doing. and they just don't. Okay, now here's the thing. Because again, you know, we don't do this. It's not a documentary show.

1:08:51I only have you on here. So I've got to be respectful of Lion Capital. And there's, you know, there's emotional. It's like a house. It's like a business. It's like anything that somebody creates. I'm emotionally attached to how I built this. Right? The reality is that you can just let it go if you want to. and just say, you know what? I'm just going to let it go and I – whatever. It is what it is. Oh, and I have. Okay, good. The fact that we're talking about it is fine. Like I said, I don't – Because it's healthy. That's healthier for you. Oh, yeah, yeah, yeah, yeah. I don't think about them ever.

1:09:29I do a board call every now and then, whatever, but I don't even – I don't comment on the call. I don't go on the screen. I'm just on mute and I'm listening. But, yeah, there's always two sides to every story, and I 100 % agree with that. So here's the thing, right? And this is like a fear that I think a lot of people have, especially as they get into their 50s, which is you've had some success in your professional life, whether it's a business or you're working for a company or whatever. And for a variety of reasons, that ends. And you can live for the rest of your life. Yeah. Like, right. You can be you can live off what you made and live a good life.

1:10:10But you lose that purpose, that sense of purpose, which is really scary. 100 percent, Guy. That's it's so important. And no one you're never going to understand it unless you've lived it. Yeah. But I did. I did care about my brand a lot. When you look back on this whole journey and you think about where you got to because you did really, really well. You know, how much of where you got to do to attribute to the work you put in the grind and how much you think has to do with getting lucky? I think 100 percent to the work in the grind. I don't I know a lot of people out there have gotten lucky. Yeah.

1:10:46I don't use words like hope, luck, wish and try. Yeah. I just don't like the word luck. I think it was always said luck wins you the lottery. I created my own lottery. That's Barry Turner, co-founder of Lenny and Larry's. By the way, I think there's something you're not telling me that I think you're concealing from me here, which is I'm looking at the cast of that movie you were in, Death Becomes Her, and Fabio was in that movie. You know what? You are right. You did not tell me that. I forgot about that. Fabio was your co-star. Well, you weren't a star, but you guys—you and Fabio were in a movie together.

1:11:28Yeah. There's Fabio. I wonder what he's doing these days. He seems like a nice guy. I think he's done some like self-parody stuff. Yeah, that's my buddy.

1:11:39Hey, thanks so much for listening to the show this week. Please make sure to click the follow button on your podcast app so you never miss a new episode of the show. And please sign up for my newsletter at GuyRoz.com or on Substack. This episode was produced by J.C. Howard with music composed by Rumtine Arablui. It was edited by Neva Grant with research help from Catherine Seifer. Our audio engineers were Patrick Murray and James Keeley. Our production staff also includes Alex Chung, Carla Estevez, Casey Herman, Sam Paulson, Chris Messini, Carrie Thompson, John Isabella, and Elaine Coates. I'm Guy Raz, and you've been listening to How I Built This.

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