898 Olo Tchala: Founder & CEO of Alaffia

0:00Kara Goldin:I am unwilling to give up, but I will start over from scratch as many times as it takes to get where I want to be. You just want to make sure you will get knocked down, but just make sure you don't get knocked out. So your only choice should be, go focus on what you can control. Hi, everyone, and welcome to the Kara Goldin Show. Join me each week for inspiring conversations with some of the world's greatest leaders. We'll talk with founders, entrepreneurs, CEOs, and really some of the most interesting people of our time. Can't wait to get started. Let's go. What happens when the company you built to change lives grows bigger than you ever imagined, but somewhere along the way, you realize you need to fight to protect the mission that started it all.

0:54Kara Goldin:So hi, everyone. Welcome back to the Kara Golden Show. Today's guest is Olo Chala, founder and CEO of Alafia. In 2004, he co-founded Alafia with a radically different idea for what a beauty company could be, sourcing ingredients like unrefined shea butter and African black soap directly from women-led cooperatives in West Africa, built products consumers wanted and used commerce, not charity, to create lasting economic opportunity long before fair trade was even really a conversation and clean beauty, et cetera. But along the way, some challenges erupted in addition to watching this company grow to incredible, incredible leaps and bounds.

1:50Kara Goldin:But I cannot wait to get into this conversation. We're going to shorten Olo. He said I could shorten it to O just so I don't screw up. We could do that. Perfect. I cannot wait to get into hearing more about the journey in building Alafia from the ground up and what happens along the way to a passionate founder who has a mission-led company that maybe it starts to really get taken in some ways, for lack of a better word. So, oh, thank you so much for coming on. Very excited to chat more. No, thank you. Thank you, Cara. It certainly is an honor to speak to you. You yourself have been a pioneer and I think not only being the pioneer and create scale throughout this nation, but to give platforms for entrepreneurs and folks like myself and others to be able to share their stories.

3:00So thank you for that. And it is certainly an honor to be able to speak with you.

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3:55Kara Goldin:And this isn't based on marketing promises. in a clinical trial, DSO-1 was shown to improve regularity, reduce bloating, and alleviate gas. Plus, it requires no refrigeration, making it easy to maintain your routine at home or while traveling. Make your daily probiotic one of the more informed decisions you make today. Go to seed.com forward slash Kara Golden and use code Kara to get 25 % off. These statements have not been evaluated by the FDA. These products are not intended to diagnose, treat, cure, or prevent any disease. Thank you. Let's start with Alafia. So today, what is the brand for those who are maybe not as familiar with it?

4:47Kara Goldin:How would you describe it? Yeah, thank you. I think it's difficult to describe Alafia as a brand. I've seen Alafia some 23 years, 24 years ago as a model for social change and particularly for woman-led change. And I can explain what I mean by that. So to me, a brand certainly has a simplistic understanding of a company. And I laugh here in the simple term is an ecosystem and organizations that take into account of human needs first. And when I say human needs, human's well-being, meaning those who are making the ingredients that go into product, their well-being either economically, health and respect for their culture.

5:46And then those who are using the product, using a product that is accessible in terms of pricing, well-being ethical, and also clean for their family. So, to me, when I look at all that together, that is not just a brand, it's an organization that not only provides a solution for a combined of communities in both of our country, here in America and also in Togo or Ghana, but an organization that is also paving the way for the future generation so that we can reside in peace.

6:28Kara Goldin:Where did the idea for the company start? So 23 years ago, maybe even a little further back, this was an idea. But how did you decide, I'm going to go and start Alafia? And did you ever imagine it would not only be the size that it is today, but also that you would have had the journey that you have? No, certainly, I don't think anybody can fathom, even myself, right? The biggest dream I had growing up in the central Togo is maybe one day to have a bicycle, right? We're farmers and grew up in an eight by 10 room with eight siblings. And my father has 42 children, dropped out of school by sixth grade.

7:22So you certainly are not thinking that you are going to start an enterprise for a solution for humanity. But what I do know, aside from the idea, is the character and the backbone that I believe I derived from my mother. My mother was an indentured servant in Benin, and she brought us up to work hard, to respect our culture, and to be able to serve the community above all. Say when I came to U.S. of sixth grade education, went to community college and be able to go to University of California Davis, I began to see the world in a little bit different way. I can see how we were growing up in this so-called extreme poverty and seeing the richness of America and knowing that somehow the backbone of America too depends on Africa.

8:24And what can I do? Those were the questions I was asking myself. What can a young man at the time, I believe I was 22 or 23, I knew that we live in extreme poverty back home. Here I am in America. What can we do? Should I go back home and we have 80 % employment rate or stay in America and also my conscious? And my mother always said, put the community first. And I see the suffering that she was brought up on. Essentially, I just thought that I should contribute. I should contribute in reducing human suffering. and children like myself shouldn't drop out of school. And then when I look, what can I actually do then, it became very, it made sense to me, it needs to be something that matters to the communities that creates what I call dignity.

9:26And what I mean by that is that dignity is when a person is able to create something, meaning people back home or people like my mother, that they have skill set and they can do something and use that. And if they're able to use their skill set, they feel good about themselves. It doesn't mean if they go to school or if they're poor, they can do something. And in addition to these, I thought that I should at the same time provide a solution for the people in America too so that the Americans are using healthier product. And if Americans can see the benefit that the Africans are offering, then it becomes beneficial to both of our communities and nobody's having to give up anything.

10:17And that model can generate income and that income can be investment for the future generation. That is a model. They create economic opportunities for those that wouldn't otherwise have it today. And then the money that we generate through that process to do forward investment. And Shea Trees was what was feasible. We used student loans and Shea Trees grow wild in West Africa. We traditionally handcrafted Shea Butter when I was young. And so I thought that's where we need to do. But when I talk about dignity, I think it's really important that we have women in our communities. I'm talking about 16 different countries across West Africa that have skillset on how to traditionally make share butter in a natural way that does not involve chemicals.

11:05And so we thought that's what we need to start there.

11:10Kara Goldin:So you graduated from Davis and you decided that you wanted to help different businesses in the country that you knew so well. But what was the first step? What was, did you have a relationship with somebody that really wanted to get their ingredients or products into the U.S.? I mean, what, I mean, it's a big undertaking. It's not like you're calling a local company in California. I mean, you're going to be bringing ingredients and products from another country. and there's a lot of steps that go on and it's hard. I mean, it's hard being a founder, but it's even harder when you're trying to do something and bring it from another country.

12:08Kara Goldin:But also 2004, you're bringing the idea of clean. And I mean, I get it. It's really hard what you were doing. Fair trade. There weren't a lot of companies talking about this. Especially non-personal care, right? Yeah. And maybe that's why I have gray hairs now.

12:37Exactly. It's definitely hard. But, you know, I think it's about a convention, a belief, a belief that you could be of a service to humanity. And I think that of all the entrepreneurs out there, when you have a belief, being at the service and a servant of your community and providing a solution, you find ways. the pain, the hardship, you can overcome them. Or you spend your whole life trying to overcome them. That is the reality sometimes. We work on those things. At the time, to answer your question, we did not have somebody that would buy shea butter. But we knew that West Africa has shea butter.

13:30We knew that Americans are using shea butter. But how do we get it from the West Africa to American hands? That's, to be honest with you, I didn't understand the whole logistic. Had I not understood the whole logistic, I don't think I would have done it. Part of doing things in life is that maybe you don't fully understand them. But you were determined that when you use your student loan, I was fortunate. I got a grant from the University of California in Davis to pay for my tuition. But I will use the student loans to help start the women cooperative. And if you're me, where you're looking at those women as your mother, you can't fail.

14:19You cannot. They can't make their share, but you come to America and say, okay, go back home when they never had a job. You just simply cannot do that. So there was this moral duty that I believe I had upon myself. And what we did was quite simple. We go into the Google, we tap in and see who's using ShareButter. And those days, and then it's coming up and you have phone book too, and you just make a phone call, cold calls. And that's what Rose and I just did. And we'll sell the 50 pound here, 20 pound here. Because at the beginning, we did not, we're making product to put in the bottles like these.

15:03At the beginning, we didn't do that. At the beginning, we're just selling bulk products. And I quickly realized that the bulk product are an input. An input, you want to push a price down because just one ingredient out of the many, you look when you make a lotion. So I thought, no, no, if our whole reason to exist is to bind by the fair trade principles and pay the woman the fair living wages, we cannot be just an employee ingredient. That's what Africa has done all along. So maybe we need to just be a brand on the shelf so we can get the margins beyond the shelf. But how do you do that? We didn't know.

15:54So I decided that we're going to just take the pure shea butter, which is made in West Africa, and then just pour it in the little jars. You know, you order little jars, two-ounce jars, and you can play your own label in Inkjet, if you remember those days. I didn't know what UPCs meant. And then I was going to street fairs and start selling street fairs. And then, you know, the street fairs that winter will come. By the end of 2004, winter comes. When winter comes, there's no street fairs anymore. So I start taking it to local co-op. And then that's when I say, you got to get UPC. What is UPC?

16:31So you go find out what it is. And you just go one step at a time and get the book from the library and read on how to make lotions. So you start mixing lotions. And it will build from there one step at a time to become number one in nation.

16:46Kara Goldin:That's incredible. So how long did it take you before you were moving out of bulk to actually developing your own products and your own line and actually going into retail or going direct to consumer? I would imagine you were maybe looking at a little, I mean, you were sending it to people, but whether or not direct to consumer had really taken off at that point. Share a little bit more about that. Yeah, it was, again, this was a, it's almost as if you're a war, right? You have to win. You cannot fail. And when quickly realized that a bulk product, nobody wants to pay the right price, literally within seven months, it was very clear to me that we needed to be in, we have to create finished product and branded product.

17:43That was very clear. We're doing seven months. But we start slow, right? We start with what is reasonable. Because at the time, I did not understand this whole idea of to go borrow money. Even if you go borrow money with any investors, they wouldn't give you the money anyway. Because I didn't have a full business plan. All I knew is that I have to do good in the world. And from there, you build little by little, step by step. And then after two years, you begin to realize there's a need to have a strategy. There's something called strategic thinking.

18:24Exactly. And there's something called cycles. And, you know, the stores work a certain way. And what I got to go into a different timeline, you got to fill all the paperwork, you got to do promotions, you got to do, there's all these different things. So I remember when we first hired our first employee in Olympia, Washington, we're still in the mobile home. We live in the mobile home at the time. And if you're trying to hire somebody when you're in the mobile home, I don't think they want to come and work for you. So, yeah, it is. But I do want to tell you, though, it was in, you know, 08. If you remember in 08, 2008, there was a recession that was happening in America.

19:08There was Lehman Brothers. You know, the big banks were failing at the time. And I was very concerned some six years into starting the organization. And by that time, we have over 300 women who are working on a daily basis and over 8 ,000 women who are collecting the share. It was a pretty significant amount of women that I felt quite responsible for. And I was really concerned that if Americans are losing their jobs and they're concerned about the recession, then what am I going to do with those women back home? And that's where my first strategic thinking kind of kept in. I say, you know, we learned something in school.

19:58which we did, I studied economics or capitalism in school called supply and demand. And I said, okay, if the economy is going down, I mean that people need to be more price sensitive with their wallet. So, but what I'm going to do is create a product that at the time these were selling, for the first time ever, we said we can create body wash and lotion at the 32 ounce and I went to Whole Foods and said, I can create these for you and you can sell for$9.99, 32 ounces. It's natural. It's a certified fair trade and you don't have any product at that price. And I think from there, it became history.

20:45But I was just looking for ways to keep a woman busy and also at the same time, trying to show that even in a difficult time in America, You can have an ethically made product at a good, sensitive price. And that really is like a cotton fire. And nationwide, we have cemented our place. But I think to be honest with you too, anytime there's a sensitivity in the marketplace by the economy, what I call the big boys, they don't invest. We've got nothing to lose. That was a time for us to take shelf space. And we went for it and we did.

21:29Kara Goldin:So was Whole Foods always one of your largest partnerships, especially back then in the early days? Not at the beginning. We actually got rejected for the first, you know, four years of our existence at Whole Foods. Nothing bad about Whole Foods. I think they know that I will speak my mind with respect. that we were rejected for reasons that our labels were not meeting the standards of the scale, the appeal that they have for their customers. Because I would just write letters, you know, and explain why these products belong there and why it's good for the Americans. I wasn't even defending the African woman.

22:12I was saying why the Americans should be using this product. But the truth of the matter is we just weren't, our packaging was not up to their standards, so keep rejecting it. And once Whole Foods gave us a chance to try four or five products, they did what's called optional, optional approval. So it means that we can put in the system, but you got to go from store to store to sell the product. And I can tell you, I've been to at least 90 % of whole food stores back then. And I would just go from store to stores and sell them. And then after a while, we start work at the regional level and start work at the global level to the point where we begin to really look in the set and begin to form what we still continue to have today, a strategic partnership that is based not only about what we're doing in terms of goodness for the world, but about innovation.

23:13You know, the key thing, I think, in all of these, even though we did not realize it, innovation was really a big deal for us. You know, even now, we have lots of new innovative products that we can put in the marketplace. So, continue innovations and then stay steady with your mission.

23:33Kara Goldin:So interesting. So you eventually brought outside investors into the company. What did you believe that capital would allow the company to become? Because you were just a rocket ship. I mean, it was. And it's expensive, right, to build a company. I always tell people like it sounds great to build a big giant company, but, you know, you have to pay for the packaging and, you know, getting the product into the country. All of these things, everyone wants money before you actually sell it. And then you have to promote it and all of these things. So, you know, it sounds good to go out and raise capital, but there's plenty of strings attached to that as well.

24:25Kara Goldin:So can you share a little bit about your story? Like, why did you want to bring it in? And then what ultimately happened? Yeah, certainly, Kara. I think to me, I still believe to this day, it is the most grave mistake that I ever made in my life. I'm not saying that venture capital or investment or selling a company, a portion of the company is bad. That's not what I'm saying. I'm saying for me, it is a very grave, a very sad mistake. And I say mistake for one, well, for two reasons. One, we did not need the money. We were able to generate enough cash. We did what's called total reinvestment. Any cash that come into the organization, we're putting right back into R &D, into distribution, everything.

25:28We maintain our salaries very low. In fact, we were some of the lowest pay in the organization in the U.S., not in Africa, in the U.S., because we're virtually integrated, not to lose you of a story here. So that's kind of the first mistake. You didn't need the money. The second part of the mistake is that when your social enterprise, where your ethics and your mission and your point of differentiation rely very heavily on to where people's life depends on it, taking the money, you are automatically putting their lives at risk. Because if it goes wrong, it is not your life that goes wrong. It's not your family that goes wrong.

26:19It's those that have less opportunities in life, right? And so to answer your question, why did you take the money then, if you know all of that? Well, it's a mistake. Mistake doesn't mean that it's right. after and you yourself said this it's not easy you know when you're grinding for 20 years and when I say grinding I'm talking about constantly on the road and I'm still on the road either you're in West Africa and I do believe I'll be on the ground and understand your supply chain and making sure that the right things have been done here in America not only that you're managing your team you're also with the retailer you're your own you're just everywhere I was tired Again, this is not an excuse.

27:03It's a mistake. So I thought if I'm going to bring outside investors, because it wasn't about taking the chips off the table. If I bring outside investors, they would know more than I do. They would lift some weight off me. We'll be able to have the money to hire more executives. Because at the time, we're going to go to Walmart, Target, going to market outside our natural. and I needed more skill set and more funding to bring these big executives that perhaps they understand more. And that was the reason. And very quickly, very sadly, I recognized that our ethical standing are not in alignment.

27:48And I ended up leaving the organization within a year and a half because I told myself and I understood that this organization was created for the people. And if it's not doing the people's work, then I don't have, I cannot be part of it. My conscience could not take it. And then I went for my non-compete to be over. I went to Whole Foods and said, hey, the women of Togo lost their job because the supply chain, the ethical supply chain got diverted. Even the investors came in and I left the leadership. I left the board as well, even though we still own at the time over 70 % of the organization, but they were controlling the board.

28:36And hopefully, okay, well, what do you want to do? It's, well, same old thing, but this time we can take one more notch up when we can do plastic free X, Y, and Z. and I'm going to make you a lot of money. And so we launched a brand called Aiea and in Whole Foods and Sprouse and Co-op nationwide so that we can get the women back and go back to work and then provide customers with something unique. And then we use our brand to go back and buy Alafia back.

29:10Kara Goldin:Oh, that's incredible. So how long did it take once you launched Aiea to actually go and then buy a Lafayette back. That was just about 13 months. 13 months. Yes. So, wow, that's incredible. I mean, such an amazing, amazing story. And so it's interesting because when the group came in and you left, the care and the story behind the brand, And this happens so often with founders. It's just so intertwined, right? I think it must have just been a gut punch to the brand without that. And it just seems like you couldn't fake it. No, it was, and that's why I call it a mistake. You know, you feel, I personally couldn't sleep, right?

30:10And it's so difficult, to be honest with you, to this day, because just imagine when thousands of people all of a sudden don't have their income. Those are women. I mean, we're talking about some of the young women going back into prostitution because they lost their job and because of the mistake that I made. One of the community projects that we do is maternal care. Maternal care is ensuring that women have a safe birth. all the stuff will not prevent that so that means a woman would die simply because a lot of you had to stop providing that service so it really weighs on you and then you got to look yourself and look your own daughters and look your own family and what happened why did you do this and you have to answer to them and you can't simply say well I was tired so I'm trying to get help there are many ways you can get help and so it really And also, both of all across this country, there are wonderful people across America that care very deeply about what we stand for.