From £4,000 to £50 Million: Melissa Snover’s Sweet Revolution

0:00What else are you selling? Maybe you have a prototype of an app or maybe you have a prototype of a physical thing, but in general, you are selling an idea. We have this on a wall in my factory. If it was easy, everyone would do it. If you do something that's really, really difficult, not only will you learn and expand who you are as an individual, but you will do something that will be very difficult to copy. I mean, we have 29 patents, so we have verifiable proof that what we've done has never been done.

0:27Alex Chisnall:Melissa Snover, a serial entrepreneur, investor and the founder of Nourished, the world's first personalized 3D printed nutrition brand. Once you make it past your third year and you're still alive, you have made it regardless of the size of your business, to be honest. I found a huge gap that was really important specifically to me that was missing in a market. It became an obsession. And so I would love to say that it was really well thought out. And I was like, screw it, just do it. Welcome to Screw It, Just Do It, the show for those who decided to screw it and just did it. I'm Alex Chisnell, host of this podcast and co-founder of the Festival of Entrepreneurs at the NEC in Birmingham this October 8th and 9th.

1:07Alex Chisnall:This is the podcast that brings you face to face with the entrepreneurs and business rebels who threw caution to the wind and built something extraordinary. Quick heads up, registration is now open for this year's Festival of Entrepreneurs. Join us at the NEC in Birmingham on October the 8th and 9th for two game-changing days with 200 plus speakers and thousands of ambitious founders. Get your free limited two-day pass at festivalofentrepreneurs.co.uk or click my personal link in the show notes. Welcome, Melissa. Hi, it's great to be here. Nice to see you. Yeah, good to see you again. I want to kick things off by asking, what pushed you to go all in on building something yourself?

1:45Alex Chisnall:Was there a screw it, just do it moment that made you literally decide to do this? What are you building now? Well, as you mentioned in my intro, this is actually not my first rodeo. I've actually started several companies and all of those companies kind of had a general theme that links them together, which is I found a huge gap that was really important specifically to me that was missing in a market and it became an obsession. And so I would love to say that it was really well thought out and I was like, screw it, just do it. But I actually became so obsessed that it was the only way that I could solve my own obsession.

2:27You know, I think that is really a defining characteristic that I've found in most entrepreneurs. We are not OK with accepting the status quo and the norm as it's just not available. this is just the way it is. And our natural mindset is to do something different, to fix it, to change it. And that's really been my, yeah, my journey.

2:50Alex Chisnall:What was the first problem that you ultimately tried to solve then? So my first consumer brand was called Goody Good Stuff. And it was a vegan, allergen-free, all-natural gummy candy. And I made it for myself because I've been a vegetarian, not a vegan, but a vegetarian since the 90s, the early 90s, like way before there was a whole aisle in the supermarket for plant based. And there was a huge amount of commercially available solutions. And when I went vegetarian and was vegetarian for quite a long time at that stage, the only thing that I really, really missed was gummy candy. And I could not find a single gummy candy in the market, which was gelatin free, which is the big difference between not being vegetarian and being vegetarian or that tasted like wax.

3:44Because there are some products that are made with with a starch, like giant strawberries from Arabo, for example, are are vegetarian, but they they are so chewy. It's not a real gummy. And so I basically started to investigate hydrochloric technology, which is basically gelling agents in traditional gummies. They're using gelatin, which is coming from animals. So I started to look at what are the alternatives in the plant-based world? I started taking classes at Lancaster University around hydrochloride technology and formulation technology and started developing recipes in my kitchen. And I was able to make a recipe that was really, really good, but I had nowhere to make it.

4:29So I was very lucky to have a great group of people around us at the time that were able to support us in finding other people to help make the products. And that really led me to my current business, where I have developed a new manufacturing technology at the very base of what we do. The single biggest differential is mainstream manufacturing has been set up to make lots and lots of the same thing over and over again at a reasonable value. And while that is great for some things, I think it's actually really not fit for purpose for a lot of things, most namely health. And by developing a totally new technology that could, in effect, make a unique product for each individual person around about at the same speed and a reasonable price as normal products might come across to the market, we would be able to make a massive impact in global health.

5:27And so that's really, yeah, another example of I was not happy with mainstream manufacturing. I wanted to make it more agile, more flexible and more fit for purpose for today's changing consumer demands.

5:38Alex Chisnall:And when you started out on that journey, Melissa, what were some of those first obstacles that you that you had to overcome? And you strike me as someone that's, you know, doesn't take no for an answer. That's pretty resilient. Now, that's not going to stop you given, you know, what you've done over the last, you know, decade or so with this business. Yeah. What were some of those first hurdles that you overcame? This business was founded in 2019. And I think, you know, when I first started working on the base technology, I originally thought, OK, I can probably go to another manufacturer of 3D printers and ask them to work with me to speed up my route to market, to get some really great know-how and, you know, inherent expertise around 3D printing.

6:28Because at that time, I had never used a 3D printer in my life before. And so I went to every single major name, and I'm not going to name and shame them all, but you can imagine who they are, the biggest 3D printing companies that you can think of. And I went to the mall and they said, shouldn't be done. Can't be done. Can't be done for less than six million dollars in 10 years. And so I said, you know, I'm not a patient woman. I do not have said six million dollars. And so I'm going to see if I can figure this out myself. And so I bought 3D printers off the Internet. I took them apart. I put them back together painstakingly and basically taught myself basic mechanical engineering, taught myself G-code, which is the machine driver code that controls machines.

7:18So there are lots and lots of different coding languages, but every machine that moves around is using something called G-code. So if you have, for example, an automatic vacuum in your house, that's using G-code, et cetera. And so I taught myself G-code and I also developed a really cool an additional hydrochloric technology, which would allow for us to to basically 3D print gummy. And I think that's really the second biggest challenge that I had, because in traditional gummy manufacturing, if you've never been to a gummy factory, you might not know this, but basically you are depositing a material that is so hot and so liquid that it takes between two to five days to dry.

8:03So if I was to take that recipe that would be used in any kind of manufacturing that existed today, or even if you make them at home, you have to put them in the fridge, you have to wait a consistent period of time. That would never work in a 3D printer, would it? Because that would literally print a puddle of nothing. And so I actually had to work as hard, if not harder, alongside some amazing, amazing R &D specialists to create a gelling agent technology that basically is possible to reverse. And so let me explain it in common language. So if you've ever made jelly for trifle or something, you get powder from the supermarket, right?

8:44And you put boiling water flavor and color, which it's sometimes it's already added in. You stir it until it is uniform and then you put it into the fridge. Right. Then you wait. Now, what you've done then is you have actually set the hydrochloride bonds. So you've taken a dry powder of a hydrocolloid, you've added water. The bond has basically set around the water molecules, which is what is making it jelly. Now, if you take that out of the refrigerator, you put it into the microwave, the oven in the hot sun today, and it will it will melt again. And then you try and put it back in the fridge.

9:19It will not reset. And the reason for that is up until we figured out how to do this special material science technology, the total world of hydrocolloid science would tell you that once you break a hydrocolloid bond, you cannot reset it. And we found a way to infinitely hyper suspend, break and reset hydrocolloid bonds, impectin, allowing us to 3D print them. So those were both very big challenges, but have taught me, I always think the biggest challenges teach you the most. and so every time it happens to me now as I'm you know this is my fourth company I used to look at it like oh my god the world's going to end but now I look at it like I'm good this is going to be a great education and I actually get a bit excited um underneath yeah good and do you mean like when

10:07Alex Chisnall:when you know when things start getting hard and you're getting like those no's and things aren't working you actually think actually I'm going to learn a lot from this and and quite often isn't And it's what comes out the other side is the actual learning. You just need to embrace it and move towards it. Yeah, absolutely. We have this on a wall in my factory. If it was easy, everyone would do it. If you do something that's really, really difficult, not only will you learn and expand who you are as an individual, but you will do something that will be very difficult to copy. Now, I mean, we have 29 patents, so we have verifiable proof that what we've done has never been done.

10:46and that is really difficult to do, to be able to create a competitive moat around your business and it gets more and more difficult every day because more and more things are coming out, more and more things are being protected. Creating protective moats is harder now, I think, than ever before. And so if you can do that, if you can do something that's really difficult and you have the, yeah, you have the wherewithal to be able to get through that, on the other side, if persistence wins, you will have something that is really difficult to copy.

11:17Alex Chisnall:And what are those qualities that you've got to have embraced those challenges and to learn from, you know, ultimately, you know, things failing and not doing what you want them to do? Where does that come from? I think also my upbringing, my father was an engineer, my mother was self-employed. From a very young age, they set an example for me to, if I didn't know something, look it up. This is back in the day for the young people when we had books of encyclopedias. Yeah, I know. I feel like a dinosaur. But yeah, and so we they would teach me to look everything up. We did a lot of hands on stuff.

11:55My dad had a workshop in the basement. And I think that those things gave me the foundational skills to think that's the normal way to deal with things when they become difficult is arm yourself with knowledge, learn, learn, learn and you can overcome, you can overcome it. Everything is easy when you know what you're doing.

12:15Alex Chisnall:Right. Yeah. Um, and what's, what motivates you? What motivates you now? Like what's the, is the why when you set up the business different to your why now? I, I, our mission as the business has not changed. Um, our mission is to bring personalized health to the world to make it accessible for as many people as possible in as many formats and as many combinations as are needed and supportive to improve human health through science. So that has not changed. But my personal reason for doing it probably has evolved because when I started out, it was me and like three people. And now I have over 150 people.

13:04And actually a lot of the reasons why have to do with my amazing team who I feel so grateful for every day. I don't think that it's normal to have built a business in a short period of time with that many people and to have such an amazing group of people who are equally committed and care deeply about what we're trying to do and who make coming to work every day fun and who help not just me, but the whole business achieve its goals on a daily basis. And so each and every one of our team after passing probation are given shares through our EMI plan. And so the limit with EMI is 250 people, which is annoying because one day we will get to that.

13:48But at the moment, every single new joiner is given shares. And so everyone from manual labor workers in the factory, the cleaner to the C-suite have shares in the business. And so my goal and one of the reasons that I push very hard now is to make sure that all of them walk away with an amazing experience and change your life money. Yeah.

14:11Alex Chisnall:I love that. I love that. I remember chatting with, um, with, with, with Al Barrett from Grenade and saying, you know, when you've, when you've got that kind of number of people working for you, um, you know, some of the, uh, the feel good factors and the reason you do it is, is, you know, when they, you know, sold their business for, you know, I think north of 200 million, it's people being able to pay off their mortgages or treat themselves to that dream holiday and you know I was like oh that makes me that makes me feel great I love I love hearing stories like that um but what about the challenges of going from three to like you know north of a hundred talk to me about that then how's how's that been because you know I've done I think over 600 episodes of this now and no matter who I speak to um you know whether it's a startup or it's you know exited a billion dollar business it seems to be the number one challenge is hiring people and then retaining that talent.

15:08Alex Chisnall:Has that been the same for you or have you got different experience, Melissa? I think hiring the right people is difficult to do, especially when you're trying to do it at speed. I think you can do anything well if you do it slowly. But if you have to move really quickly, you will absolutely make some mistakes and it's just part and parcel of the game. And I think you have to accept that. I think what we have learned and what I have learned, this is the most employees that I've ever had. I think the closest to this was like 20. So this is a lot bigger. Right. So this is a lot bigger. And I think one of the things that we've learned is you shouldn't hold on to people that you can tell are not going to make it for whatever reason.

16:00They're either not well suited to a startup environment or they don't share the same values as the rest of the team. They don't fit into the culture. They oversold themselves on their CV and they don't actually have the baseline skills that they said they did. and I think in the very beginning we didn't do that we acted very much like a family business we held on to people way too long we gave people a lot of chances and we actually slowed down our growth because we didn't for them and for us didn't make those decisions quickly and correctly I think now we don't do that we have a six-month probation for everyone and we are we're having meetings with the new joiners on a weekly basis.

16:45There's constant, constant communication about how things are going. We give each party, us and them, the best chance of success. But if it's not working, we don't beat around the bush about it. We make it clear right away. We have a very high retention rate for a scale up and I'm really proud of it. My entire management team were with me on like day 10. Right. So this is cool. I think this is cool. Two of my team, my CTO and my CSO were actually with me in my previous company, Magic Candy Factory, and came with me. So we've been working together over 10 years. So we have a ton of people within the business that have been with us for like four years, 4.5 years.

17:30The business is just five years old. So this is, I think, really cool. A lot of the newer people are in the facility. They're doing operational work there. They've been added to teams. And, you know, I think that's great. We don't have very many people who leave surprisingly after their probation. So if we if we all love what's going on after at the end of probation, it usually works really well. And I think that it took a long time for us to really fine tune that probationary plan so that we would really be upfront with them about what we need, what they get back in return, and either you love it or you don't love it.

18:09It is what it is. And you have to love it if you're going to work hard at it, right? So I think that's key.

18:14Alex Chisnall:If you're enjoying this conversation and thinking, I need to be around more people like this, then I've got the perfect solution for you. The Festival of Entrepreneurs is where 5 ,000 to 10 ,000 ambitious entrepreneurs come together to learn from the people who've actually done it. It's on October the 8th and 9th at the NEC in Birmingham, and I'm giving my listeners free two-day passes. Real entrepreneurs, real stories, real strategies, exactly like what you're hearing right now, but live and in person. Go to festivalofentrepreneurs.co.uk and get your free two day pass before they're gone. I think sometimes the people who sometimes people who start with you aren't the people who have got the ability or the skills or the appetite, like you say, to go from startup to scale up to see the project through to the very end.

19:01Alex Chisnall:at what point did you think you you moved moved into being a startup to a scale up like could you could you actually remember how the business was changing and how quickly things were changing you're like all of a sudden actually we're not a startup business anymore we're actually maturing as a business quite quickly I yeah I don't pay a lot of attention to these definitions I think to be honest, I know there are there's like government definitions about what it means. I think once you make it past your third year and you're still alive, you have made it regardless of the size of your business, to be honest.

19:39Not that you've made it for the long term, but you've made it to the next phase. You're no longer really a startup. I think we do brand new things all the time. So it constantly feels like a startup still. And I think that is something I'm very happy about. And I want to keep I think our startup mentality is unique. And I think one of the biggest things that I see in businesses that go from startup to scale up that all the founders regret, no one has a positive word to say about it is the loss of the startup mentality. And I think that's really key. Can we be a startup mentality business with the level of investment and, you know, regulatory compliance and governance that we have, which, you know, we are audited by the FDA.

20:30Three days they come to our factory. It is not a joke. We are operating at the same level as Montelay's Unilever from a compliance and regulatory standpoint. We are third party audited by a big four accountant. We have raised, you know, close to 20 million in investment. It's so we have to, we have a huge amount of governance, but can we do that without losing the startup mentality in the business? And so far we have done that and we, we spend a lot of energy on it. We really encourage the team, not just, not just with lip sync about, oh, collaborate, innovation. No, they actually get rewarded for talking about failure.

21:11And I think that's actually something that very few businesses do. We have Friday fails and whoever has the worst fail actually gets a prize. There's a prize that changes all the time, but there's a prize. And this is really to show that failing is not a negative and to reiterate it and show and remind people on a weekly basis or a monthly basis, depending on how busy we are, how important failure is in narrowing down the options to get to the final outcome.

21:44Alex Chisnall:Yeah, no, and I think you're right. That's something that I like to kind of dive into is, you know, not enough people talk about failure and ultimately failure is a learning experience, isn't it? If you don't have the failure, you're never going to learn. That's exactly right. Yeah, you either win or learn. Yeah, agreed, agreed. And you mentioned like at the start, say not having that that six million that manufacturers were maybe talking about. How did you go about raising funding to actually get to where you are now? Because you mentioned before, the numbers that you're doing in what you're producing are like phenomenal from the outside looking in.

22:22Alex Chisnall:But how do you get there? Like where do you start? Yeah. So I think when I started this company, it was the first ever business that I had that I ever raised VC capital from external capital. So in my previous companies, I either set them up with my own money and they didn't demand a lot of upfront capital because of just the nature of the business. Or I had friends and family investing into the businesses. So this is the first one where I actually had to look at the VC world. And again, similarly to what I did with the gummy candy and the 3D printer, I read every book I could find on venture funding.

23:03I started listening to podcasts of really well established VCs and principals and investors and capital allocators. I started attending a bunch of webinars and face to face meetings at places like seed legals. And I and I worked alongside a coach and with my my legal representative, my partner at Cooley, who's obviously very experienced in it. And and I had to learn as I went. And so my my seed round was the highest ever female founder seed round in UK history, which is not a record I would like to keep. It is disappointing that that the record is for such a small amount. It was, I think, two point seven million.

23:48And you think, like, what's the sole male founder of Seed Round Limit? I mean, it will be add like several digits. Right. Seriously. Right. Super disappointing that that's and that happened in 2019. And there has not been a change to that. And that's sad. And I feel disappointed about it. I think there's a couple of reasons why that is. And we can maybe dive into that a little bit more. But that that was the heart. A lot of people talk about what's the hardest round. I think your seed round is the hardest round, because I think at your seed round, what do you have? You have a very, very hopefully very pretty, well designed, well thought out slide deck.

24:29Yeah. PowerPoint and a decent enough ability to present said PowerPoint. But what else are you selling? Right. So maybe you have a prototype of an app or maybe you have a prototype of a physical thing, but in general, you are selling an idea at that stage. You're selling an idea. You have no people. You have no nothing. You have not started the company yet. In general, seed founding is supposed to happen at the very beginning, right? And that is how I did it.

24:57Alex Chisnall:You didn't have product or anything like that at that stage at all? No. No. I had a lot of experience. I had built and sold three other companies and that goes a long way. You can show that you're a successful founder, that you know how to build something and you know how to execute the sale of that thing. It was I had several patents that helped. IP value always helps. But in general, it was really the most difficult thing to get people to take me seriously because it was first of all, I knew none of these people at all. They had no personal background. I had no network of people that I could go to and say, introduce me to your wealthy friends.

25:37I didn't. I had to literally cold call all of them. But I was able to do it. And I was able to do it from a variety of, you know, high net worth individuals and actual VCs and even a CVC actually in a seed round, which I think is quite rare. When I did my Series A, which came two years later, it was easier because I could show the factory. we build all these machines and we're now making product and we have 10 ,000 clients and we're sending product out and I could show our dashboards of our metrics on Shopify. Look at our retention rate. It's over 85 percent, blah, blah, blah. You know, this was easier to show, but the amount of money that I needed was much more.