Scaling Special: Why Heathcote's Suzanne Lyon Refuses To Compromise

0:10Hello friends, I'm Ray Latif and you're tuned into Taste Radio, the number one podcast for anyone building a business in food or beverage. What happens when your biggest growth opportunity threatens the very thing that makes your product special? Heathcote Bakery founder Suzanne Lyon built a devoted following with an ultra-premium chocolate chip cookie made with uncompromising ingredients and a meticulous process. Then came viral demand, endorsements from Oprah and Bobby Flay, and the challenge every founder faces. How do you scale without sacrificing quality? In this episode, Suzanne explains how she's navigating growth, retail expansion, and investor interest while keeping craftsmanship at the center of the business.

1:03She discusses her commitment to premium ingredients, preservative-free recipes, and exceptional quality as demand grows. She also shares how she overcame an early production crisis and why she's carefully choosing retail partners that align with Heathcote's premium positioning.

1:24Hey, folks, it's Ray with Taste Radio right now. I am honored to be sitting down with Suzanne Lyon, who is the founder of Heathcote Bakery. Suzanne, it's great to see you. Good to see you. We're here at the Jacob Javits Center on the west side of New York City for the Summer Fancy Food Show. Is this your first fancy food show? It is. Yeah, it's fantastic, isn't it? It's fun. It's awesome. It's so much fun. First time walking the floor and also presenting. So it's been a great experience so far. Is this your first food or beverage or CPG trade show? I went to Expo West earlier in the year. So that was my first taste of the trade show life.

1:59The chaos life. The chaos. Insanity. I've never been more tired in my life. Well, entrepreneurship is a bit about chaos. It's a bit about focus. In our industry, it's really about taste. And you have some of the most delicious cookies I've ever had in my life. Thank you. And I share that opinion with a very famous person. Her name is Oprah Winfrey. Heathcote Bakery was picked as part of her favorite things list, which is a pretty high honor. Yeah. And when that happens, usually there's a run on the products on that list. How'd you deal with that? I didn't sleep for a while. Thanksgiving, Christmas was incredibly busy.

2:34We were baking around the clock and shipping every single day to meet the demand. So it was an extraordinary experience and showed really what our capabilities were. I wasn't sure how we were going to keep up, But you don't say no to Oprah or favorite things. So you figure out how to get it done. Yeah. And get it done. You have. I was Googling you recently and the title of a article that I saw was the cookie brand that people can't stop talking about. So it seems like the popularity of the cookies has gone well beyond Oprah. It's surreal. I didn't set out to start a cookie company. So to see what I've been able to build and the momentum we've gotten.

3:15and, you know, the fanfare, like every day, it's mind blowing for me. So it's been such an extraordinary experience and learning opportunity and just every little thing that happens is incredibly exciting for me. Yeah. Entrepreneurship is not your first foray into business. No. Yeah. You started out as a talent agent or you were a talent agent before you started a cookie company. Yeah. Yeah. So I actually started in the mailroom of then the William Morris Agency, which ultimately merged with Endeavor. So I worked my way up and was a talent agent in really two divisions, non-scripted television.

3:51So I represented producers and production companies and helped them develop and sell IP across the non-scripted and doc landscape. And then really spent the bulk of my time in our branded lifestyle division. So I represented lifestyle-based talent. So think celebrity chefs, designers, health and wellness experts, supermodels, and really worked with them to build their brands in a 360 basis, utilizing all the different spokes of media and entertainment. So working across TV, commercials, endorsements, licensing, books, touring, ventures, and really helping them develop their brands as talent. Was that as rewarding as being a CPG entrepreneur?

4:28It was a lot more lucrative. No, it's a very different thing, right? So, you know, as an agent, I was helping to evaluate the deals and the opportunities for talent. And as an entrepreneur, I am that client. I'm my own client. So now kind of taking a step back and looking at opportunities for myself, it's a very different exercise, but incredibly, incredibly rewarding. Now, why'd you become a entrepreneur? Why get into cookies? So I left WME in 2018 and went to the brand side of the business. So I worked across talent strategy for some high-level lifestyle brands and ended up getting laid off.

5:03And within the course of a year, I had had a daughter on my own, got laid off from my job. My mom was diagnosed with cancer. And I just had this moment of like, what am I going to do? Who am I without a really big job and a big company behind my name? And I just didn't have it in me at that moment in my life to dive headfirst into another big corporate role. And so I was a little bit lost and it was a really hard time for me. So one day I dropped my daughter off at school, came home, and I just said, I need to do something creative, anything to stop the spiral of like, what am I going to do next?

5:42What do I want to do? And I just started baking chocolate chip cookies. And I've always loved a chocolate chip cookie. It's always been like my go-to if I'm at a bakery or at a coffee shop, I'm always ordering the chocolate chip cookie, but I'm very particular about my chocolate chip cookies. And so I really just set out to like figure out how to make the cookie that I loved so much that I couldn't find in bakeries or restaurants. So I started baking and I really just became fixated on creating the cookie that I loved so much, but couldn't find. Right. So I think the best part of a cookie is the dough.

6:18I really want to taste the vanilla and the butter and chocolate for me is optional. And everything that I found was big, thick doughy cookies, super sweet, heavy, heavy chocolate, and you couldn't taste the best part of the cookie. So as a distraction from my life, I just really hyper-focused on trying to figure out how to make the cookies that I loved. Not because I wanted to start a business, but just because it was bringing me a little bit of sense of joy and distraction from trying to figure out a job. When did you create the perfect Suzanne Lyon cookie? It was in the summer of 24. And I had just kept baking and baking and baking and giving them away to everyone and anyone I could think of because I had literally hundreds of dozens of cookies laying around at any given period of time.

7:08And one day my daughter's teacher had given her cookies and a couple weeks later she had asked if she could buy cookies from me.

7:15Suzanne Lyon:Wow. And I thought she was kidding. I was like, you're just being nice because, you know, I'm going through a really hard time right now. And she's like, no, really, I have to go to a dinner party and I'd really love to bring them. I'm like, OK. So I like bought some packaging and made some labels. And that was my first sale. And even at that point, I didn't think I was starting a cookie company. I thought it was just this fun little thing that I could do on the side while I, you know, got a real job. And that was just like making me a little bit happy at that moment. Yeah. Yeah. One of my favorite TV shows of all time is the show called How to Make it in America.

7:48Yeah. It only lasted two seasons. And I know some of the folks that were behind the show Entourage were behind that show as well. And I know you know Entourage because of Endeavor and all that stuff. There was a point in, I think it was the fourth episode of the series when the two entrepreneurs who were fashion designers made their first sale and they were euphoric. They couldn't believe people. So they were like, this is incredible. This is what we wanted to do. Someone's paying us for what we want to do as a career. And I imagine that must have been pretty euphoric for you as well, because you're like, maybe I could turn this into a business.

8:18Yeah. Was that that moment? Was that that spark? It was definitely this like, oh, it's somebody else really likes them other than my family who knew I was going through a hard time. And I was convinced was just being nice when they're like, these are insane, you should sell them. So it was a little bit of validation of like, okay, well, let me keep going. Let me see what I can do. And a neighbor of mine had the cookies also. And I saw him at the playground one day. And he had introduced me to another neighbor of ours who was organizing our local elementary school fall festival. And he was like, she's starting a cookie company.

8:51You should buy her cookies or have her sell cookies at this event. Like, I've never baked for an event before, but like, sure, I'll figure it out. And I sold out. Did you go to a commercial kitchen at this point? Or is it everything at home? This was all in my house. Wow. Okay. Yeah. So you were 24-7 baking for a while, it seems. 24-7 baking. It was crazy. Yeah. We didn't really, or I didn't really talk about the cookies. There's a, I have a package in front of me and I'm so grateful that you brought these because no one is going to touch these except for me because they're so darn good. But it's described as ultra thin chocolate chip cookies with a crispy edge and a soft center, the classic perfected.

9:28And I would agree with all that. The exterior is really crispy and you don't expect the interior to be as soft as it is. Yeah. They're about, I want to say four and a half inches wide. Five inches. Five inches wide? I was going to say five inches, but I wasn't 100 % sure. And the center, it's definitely not gooey, but it's impossibly soft. Yeah. Yeah. It's crazy buttery. It's salty, but not overly salty. It's really, really delicious. And I think from the first sample, anyone who's listening would be hooked instantly. And I asked you before we hopped in the mics, what made you think you could stand out?

10:06What made your products different than the 10 ,000 other brands that are selling chocolate chip cookies out there. And what do you think your superpower is? How do you amplify that superpower when you're talking about your cookies and when you're getting the word out about Heathcote as a brand? Yeah. When I kept getting kind of the validation and the fanfare and people really loved it, I actually had to remove myself from it, from the product. I had to look at it as if somebody else was starting it and they wanted to start a cookie company and kind of look at the consumer marketplace from an outsider's perspective.

10:38And I grew up on Tate's. My family grew up going to grab a bag of Tate's and bring them to somebody's house for a dinner party. It was a really lovely gift. And as an adult, I found myself thinking about the cookie market and realized that there wasn't a go-to brand today for me that I could think of to pick up at the store, bring to somebody's house for a dinner party or for a thank you gift. And it was that experience that I really wanted to create. And again, it's that, you know, the trend right now is like the big, thick, gooey cookies that weigh a ton. And this isn't it. This is, I call them adult cookies.

11:15They're a little bit less intimidating. They're kind of elegant in the way they look. And they're super impressive. Our packaging is really simple. And for me, it let the product speak for itself and just really looked at like, what is that daily, highly consumable product and brand that also is impressive enough to stand on its own as a gift for somebody. better for you ingredients can help a product stand out but turning those ingredients into a business that grows is the harder part join non-base for a free webinar on july 28th with tom first founder of culture pop and heather wood svp of marketing at goodles they'll talk about what it really takes to build clean label brands that drive trial repeat purchase and sustainable growth from formulation and sourcing to branding retail and operations sign up for free at non-base dot com slash podcast.

12:08It's really interesting and notable that you talked about removing yourself from the brand. And I hear this all the time, which is that founders fall in love with their products to a fault, where they don't realize that they need to make adjustments, that they might need to listen to outside voices to improve their product or brand or packaging or what have you. I imagine that your experience as a talent agent and being able to step back and say, even though I really like you, we need to change this or change that. What were the non-negotiable elements of the brand that you felt like were critical to its success?

12:46Quality ingredients was first and foremost. So, you know, I tried nine different butters before I found the one that I wanted. It wasn't the cheapest butter. Obviously cared greatly about margin and have to make some money on this, but the quality of the product is not something that I'm ever willing to compromise on. And something that a lot of people had kind of advised me on or giving me feedback on is like, you have to figure out shelf stability. You have to make it more shelf stable. And every time I picked up a bag of chocolate chip cookies at a bakery aisle of a grocery store or went to order online, I'd turn around and look at the ingredient list.

13:19And it's full of gums and preservatives and artificial flavors, and it's unnecessary. And, you know, I really feel strongly that you don't need to make something last for six months on a shelf. And quite frankly, I don't want to buy those products. I don't consume them. I don't want my daughter eating them. And so for me, it's like, how can we market a brand? How can we position a product as truly just being natural ingredients, real ingredients, premium ingredients, and educate a consumer to say, okay, if I see this on the shelf, I know that it's good. and that it hasn't been sitting there for four months and I'm going to get it and, you know, buy it in that moment and know that it was like, it was freshly made and it's within a window of...

14:04A few days. A few days. Yeah, you would eat the entire bag within a few days as opposed to keeping your pantry for a year and it's still the same, right? Yeah. This clearly is meant to be sold in a certain type of store to a certain type of customer. How much did you think about that retail store? How much do you think about that customer when you were designing the packaging, when you were coming out with the branding, did you feel like they needed to match or did you feel like you need to prove out the concept in these stores with these consumers before you go any further? I really was thinking about who the consumer is that's going to that potential store, right?

14:42That retailer and for the product. So you did have to think about the retail first. I thought about it, yeah. And also it's a relatively high price point for cookies. You get 10 for... There are a dozen. There are a dozen for... It's$32.50. Okay. And so it's the same price, whether you're buying direct from us on the website or you're buying them at a retailer. And so it is definitely a certain audience that's going to purchase, you know,$32 dozen cookies. So when we thought about, when I was thinking about retailers, it's like, where is that customer? Where is that consumer? And how do I kind of have a product, my product that I value so much?

15:16And I kind of, I think it looks beautiful. I think it tastes beautiful. I think it's different. and a retailer that has a curated product landscape that matches that. Yeah, you're thinking Dina DeLuca, you're thinking Zaybars. I love me, Dina DeLuca. Yeah, I mean, the specialty stores that are really well known for their selections. Exactly. We just launched in Citarella about six weeks ago in all eight of their locations, and it has been extraordinary. That's kind of the ideal marketplace. You were talking about retail and wanting to find a brand that could match your passion for cookies and what you've created with Heathcote and not seeing many of them.

15:54But does it benefit you to go into retail? I mean, does it benefit you to scale in that channel? It's about brand awareness for me, right? So the more people that can see the product and say, what is that? And taste the product, the better. And so what I've seen in a relatively short period of time is that the purchase from the retailer is converting to the sale in DTC. Last summer, we were in one small farm stand location in the Hamptons and two gourmet grocers, one in Nantucket, one in Martha's Vineyard. And the number of consumers that have purchased in-store and then come back to us is pretty significant.

16:32And so for me, yes, is the margin lower? Definitely. The scale's there, though, and the volume's there, which is hugely helpful. but it's really about customer acquisition and then converting them to a direct sale and having them purchase and send to others for gifts and the brand exploration. Yeah. People going on summer vacation and seeing your brand coming back home and being like, hey, I want some Heathcote Bakery, buying it from your website. Yeah. They're staying with friends for the weekend. They had cookies from Citadel and the Hamptons. They're now, you know, shipping them out to their friends in California.

17:04And we see that a lot. It's a really important part of our growth trajectory. Taste Radio meetups are continuing in Chicago, San Diego, San Francisco, and London. Come hang out with the food, beverage, and beer community for live podcast recordings, CPG networking, and sample sharing. Want to attend or partner with us? Head to tasteradio.com slash meetups. Quick pause to let you know that the leading event for the beverage industry is headed back to Los Angeles this December 6th through 8th. BevNet Live brings founders, investors, retailers, suppliers, and operators together for product discovery, high value conversations and partnerships that can shape what comes next.

17:42Early registration pricing is available now. Head to BevNetLive.com to register. Mark your calendar. Nosh Live is back December 3rd and 4th in Los Angeles. Join packaged food founders, buyers, investors and operators for two days of product discovery and conversations focused on what's next. Early registration pricing is available now. Head to NoshLive.com to register. How cautious are you about growth? Because you mentioned quality is so important. Yeah. And as you grow, you're going to need help and move to larger facilities to make your products. And that's typically where quality falls off.

18:16So how do you think about growth from a quality perspective? When I first started baking, I had a cottage license. So I was baking out of my house. I had dropped cookies off at Bobby Flay's office one day. I was delivering cookies to friends and I had known him from my agenting days. Hadn't spoken to him in years. And I just wrote a note saying, you know, happy Thanksgiving. Hope you enjoy. and I got a phone call 20 minutes later saying, what are these? These are insane. You have the next Tates. And I was thrilled and couldn't believe it. And Bobby Flay likes my cookies. And before I knew it, I had gotten a note from his office saying, Bobby wants to feature you as his favorite thing for this year for his holiday go-to gift guide.

18:53As if Oprah wasn't enough. I know. Well, this was pre-Oprah, but like that was, I was like, oh my God, wild. So I baked that entire Christmas. This was two Christmases ago from my house. My dad turned the garage into a packaging room and we were limited to shipping only in New York. So literally baked around the clock for a month straight. Then moved into my first commercial kitchen in Harlem and it was an amazing learning experience. It was awesome. End of June rolled through last summer and I walked in at 5 a.m. one morning with$30 ,000 in sales from an influencer had posted and it was 94 degrees in the kitchen.

19:27They did not have sufficient air conditioning. It was the first hot day of the summer. And I panicked. I couldn't bake. I couldn't do anything in there. Because the cookies wouldn't come out correctly or that you were just going to pass out? No, I was fine. I'm pretty like I can handle it. I'm sturdy. But the butter was melting on the trays. The cookies were melting on the trays. And they're so thin that they absorb all the moisture in the room. So the cookies would come out and it was so humid and so hot that they would just flop. You could fold them over. They wouldn't hold up. They were terrible.

19:57And I went home that night. I was in tears. And I called. I said, who can I call? Who could help me? and I called Buddy Valastro, the cake boss, who, you know, is the, I don't know. Very famous boss of cakes. Very famous boss of cakes of Carlo's Bakery. I knew him from my old WME days and he answered immediately and I said, I'm in trouble. My kitchen's 94 degrees. I have all these orders to fill. I don't know what to do. I have nowhere to bake. And he said, come on in. I'll see you at 6 a.m. And he met me at six o 'clock in the morning at his factory. It's a massive manufacturing facility in Jersey City.

20:29And he opened the loading dock gates and helped me unload everything with his sons and gave me a place to bake, to fill all my orders. And he said, you've got a roof over your head and you've got a mixer, like, just do your thing and keep going. And it was the most extraordinary gesture I could have ever imagined and the most stressful summer of my life. But I was so grateful for him. And then we started talking about, you know, what our relationship could be like. And then Oprah happened and he's like, OK, you need help. You can't scoop these by hand every day. Here's a 60-year-old depositor.

21:02Let me show you how to use it. And he just never pushed me to grow faster than I could. And, you know, I bake every single one of these cookies myself. And so he's really just provided this infrastructure for me to grow and scale that a lot of businesses otherwise aren't in the position to secure. But you made a choice, though. I mean, I think you chose to not compromise on quality. Oh, God, no. I think there are some folks who wouldn't necessarily say, OK, well, this is the only option we have. And you say, well, I cannot. This is not an option. I met with co-packers, several of them, and they I said, this is how we do it.

21:37And this is important that we we stay with the process. And they said we can't do it. Aside from the fact that I'd have to raise capital just to fund the inventory, they couldn't do it to my specs. And that to me was the most important thing of, you know, if it meant that I had to build out my own space so that I can continue to build my process for this cookie that people love, I was going to do it. I'm just fortunate and lucky enough and grateful to Buddy that he believes in what I'm doing and my abilities and he sees how hard I'm hustling and he's just, he's really said, let me help kind of provide the overhead and the infrastructure to help you grow.

22:13Yeah, I think we're coming full circle to quality as being your North Star. The most important thing for me. The most important thing. Because the minute you start to kind of wave on quality, you start to lose the trust of the consumer. Yeah. And we're a really young brand, right? The most important thing is that when somebody buys the cookies or has them at a friend's house and then they go buy their own, that it's the same experience. We are still small batch. We are still doing everything pretty much by hand. So maintaining that level of consistency is vital. So do you think there's a point at which you're going to create a version of your brand where the quality is still the most important part of it, but in a package and in a format that is a little bit more approachable from a price point, say$32.50 for$12, could you see yourself creating a more retail-ready package for a cookie, say, for$10?

23:08Yeah, so we're actually about three weeks away. We're waiting on the packaging to actually come in to launch a retail-ready six-pack. Okay. A sub-20 price point, you know, way more approachable for daily consumption and more friendly for retailers. So you'd see it at potentially a Whole Foods or a specialty retailer that has more stores than, say, four or five. I'm trying to think of a specialty retailer like that. I mean, certainly Erewhon is a great example. Erewhon, a Wegmans, something along those lines would be Dreams. Yeah. But yeah, definitely that smaller quantity breakdown is something that we're looking at.

23:44I am really thrilled that this is all happening and working for you. Of course, not everything is going to go peachy the rest of the way here. But how do you define success? How will you define success for this brand and for yourself? I don't know that I have an answer to that. Mostly because when I started doing this and started baking and going, I didn't have a roadmap in mind. I didn't have a plan in place before I did it. If I can continue to build a really successful business, a profitable business, which we are in our early, early stages, that's most important to me. Listen up, entrepreneurs, because profitability from the get-go is a good thing.