Founder + Funder: Fundraising, Founder-Investor Fit, and Building the Next Big Breakfast Brand with Emily Groden of Evergreen and Brian Bernstein of Rich Products Ventures

21:48Hannah Dittman:Emily, what a founder story that you just told. Also great pieces of advice from both of you and really helpful color. But yeah, I just want to double click on how tenacious, resilient, hardworking, and just dream oriented you were to be juggling two jobs, hustling from your home, bringing bags around the corner stars, brick by brick building up a business with so much passion and grit. I mean, oftentimes when we speak to investors, you always hear investors looking for resilience and tenacity and their founders and humility as well, which you clearly have in spades also. Yeah, you just totally hit the checklist of all the things I know investors are really looking for.

22:34Hannah Dittman:So it's no surprise to me why you've gotten where you've gotten and the success you've had fundraising as well. Brian, what were kind of the main pillars of diligence, the initial pitch, and kind of the fundraising story from your end of the table? What got you guys really excited about this investment and felt like you had built enough conviction in these key points that you were ready to get into business with Emily? Yeah, I'd say it started with the product. The product was, we had tasted it as a team both during expo, but then we followed up and bought some ourselves and really liked the product and the brand.

23:13So I think that is a key first step to evaluating any CPG branded food product. The conversation evolved though, to get deeper into the financial model, understanding kind of aspirations for where the brand could go, both from a top line perspective, but also from unit economics perspective. And it's something that we know a lot of early stage brands don't necessarily have their unit economics worked out fully, but it's something that we like seeing the vision and real data behind where the product can go based off plan to improve the unit economics. So if you're talking to investors, don't just say we think we'll be at 40 % contribution margin, show the bridge to get there, because I think that's key to really painting that picture and making the story easier to explain to investors.

24:02Emily Groden:Investors love bridges. I'm just going to say. I've got to make a bridge and move them all the time.

24:08Hannah Dittman:Yeah, I can think of the chart in my mind. They're hard to put together, but they really do paint the picture well. But I would say it's painting that picture of where the brand could go, where the products could go, where the financial profile could go. And then it's also, there's a number of calls that we had with different members of Emily's team. So we wanted to get to know each of the key leadership team members. So we spoke to Emily's finance lead, her supply chain lead, her sales lead, her marketing lead, and really got to know them. And we wanted to have those conversations one-on-one with each of them so that they didn't feel like they had to speak under their boss, but could speak openly with us and all of them passed the test.

24:46And then we also went deep with Emily on as a strategic where we thought we'd be able to help out and where she thought she could use our help. And that's something that even if you're not talking to a strategic investor, just really aligning on what you're hoping to get out of that investor relationship ahead of taking the investment is important. Every investor has a different role, I'd say. Some investors will be 100 % focused on your finances. Some investors will be 100 % focused on your supply chain and how to improve your supply chain operations. So it's really feeling out who you can bring in to fill gaps in your current business today and help you get to where you want to be.

25:27So we had all those conversations. And then, of course, there's some negotiations that happen towards the end around the finer points of the deal terms and stuff like that. Fortunately, since we weren't leading, we didn't have to price the round or go into the deep legal diligence that a lead investor would do. But we still have a number of points that we like negotiating to ensure that there's founder and investor alignment once the investment is closed. So it was a relatively painless process as far as I remember. I don't know if Emily would say the same thing.

26:00Emily Groden:Totally painless. Yeah, and I think it's been a positive relationship coming out of the investment so far as well, which I think is driven by a lot of that alignment that we make sure we have going into it.

26:11Hannah Dittman:Super helpful. And really, I think, interesting to understand the investor mindset of how you're thinking through these things and the different areas that you want to double click on or dig into as you're kind of thinking through a company journey. Obviously, Emily, when you're going through a fundraise, you're kind of inviting investors into a big vision and where you see your brand going down the road. And Brian, that's also what you guys are all getting excited about when you're talking about the financial model. That's like the numbers version of that vision. But from a narrative standpoint, where do you guys see this company going?

26:49Hannah Dittman:What's the big dream that you both have for the brand and where you see the future of evergreen towards the fruition of your investment?

26:59Emily Groden:I think of the evergreen journey as two chapters. In chapter one, which we're in right now, I view it as building the next big frozen breakfast brand. As much as I would love to be out of the frozen aisle sooner than later, there's so much white space in frozen breakfast and like very specifically in our syrup carrier category, which is my favorite term that I've learned over the last six years. I've never heard that. I love that. It's so good. Have you seen us at Expo or any trade shows? We have hats that say waffles and pancakes. And I really think our next hat might have to be syrup carriers.

27:37Emily Groden:Syrup carriers are waffles, pancakes, French toast, the syrup carriers. And so there's so much white space ahead of us just in those narrow categories. And as Brian was saying, like we're building out this platform, but still trying to stay really focused so that the products that we want are merchandised next to each other and we can keep building out this really beautiful brand billboard within stores and continue to raise brand awareness that way just through presence on shelf. But then I think there's a chapter two of the evergreen story, which is hopefully we've earned the right to jump categories and that consumers are demanding evergreen products across categories.

28:14Emily Groden:I know like from my standpoint as a mom, I hate our pantry still. Like the snacks I give my kids make me cringe. But you have a problem as a parent where like you need your kids to eat a snack. My kids will not eat the really healthy snacks. And so I just have to get them snacks I don't feel great about because like they need to eat something or it's going to be that situation for everybody. And so I think there's a feature where we could play in different categories for sure. But that's down the road because we've got a lot of work to do in our narrow little category. Yeah. And I'd say on our end, Emily didn't mention the name, but there's a name in the frozen breakfast category that has big yellow bags and boxes, and they still have 70 % market share.

28:55And it's something that we think Evergreen can eat into and get to a point when we invest in companies, we're obviously underwriting it to an eventual exit. We have a longer term horizon as a strategic investor, but we still are planning to get financial returns on all of the investments that we make. So in Evergreen's case, we'd love to see them eventually find a new home, whether it's a private equity firm or a strategic buyer who views that same platform vision for the company and for where it can continue to grow into. So we think there's a lot of runway ahead for the business to continue to grow both in its existing doors, grow velocities in its existing doors, grow the number of SKUs that it has in there, but then also opening up a lot of new accounts where Evergreen really hasn't been exposed to the world yet.

29:46So we definitely think there's a big opportunity in the mass channel and across conventional doors as well. So all of those are exciting growth opportunities for us that we think will make an exit even more enticing down the road.

29:59Hannah Dittman:Huge potential. I see so many of the things you guys are talking about so easily coming to fruition. Maybe an evergreen syrup one day for the Syrup Carrier Squad. Tons of opportunity. Syrup Carrier Squad. That should be our loyalty program. Love it. Yeah. Choose your favorite character, which one you like the best. Obviously, you've got big dreams for the future, but I'd love to take a second to reflect on the past. What have you learned throughout this investment experience or your journey throughout your full brand experience that you think others could learn from?

30:35Emily Groden:I feel like I learned 10 new things every day, which is what makes this so fun, right? It's so stimulating and so fulfilling and so challenging. I mean, I think probably, and we've touched on this already, the thing that I've learned is just how hard it is. I run into what feel like roadblocks multiple times every day. And I do think that in the founder position, like you do have to be pretty relentless and willing to run through brick walls. I was an endurance athlete in my past life. I swam in college and I'd run marathons and done Ironman triathlons. And I always say that I think that has been the best training for this role because, you know, endurance athletics is all about like you think you've got nothing left in the tank and you have to reach a little bit deeper and find it and get across that finish line.

31:24Emily Groden:And I just feel like that's so analogous to this journey. And I think where that applies, like when you're thinking about launching a company and whether to do it, I think building a company that comes from a truly authentic need can carry you a long way. and kind of provide that extra motivation to dig deeper and get across that finish line. Because in my case, like my kids eat our products. My daughter ate two of our waffles this morning. My younger daughter eats them frozen, which is interesting. But anyway, she had two waffles this morning. My kids eat our products probably four to five times a week.

32:03Emily Groden:They would never be on time for school without Evergreen. I live my brand every day. And so I see how helpful it is for me as a mom. I see how much my kids love it. And I'm just constantly reminded of like, this is why I do this. This is why we need something like this out there. And also, like, I believe on a fundamental level, like American kids deserve better than the options that they've historically had. And so I'm just so driven every day to make sure we get evergreen on as many shelves as possible so that kids can have a better breakfast. But there have been times when I felt like curling up in the fetal position under my desk and having that authentic need in my life and that real passion for what I'm building and that real deep, deep-seated belief keeps me going.

32:47Emily Groden:And so I think a piece of advice for founders is like, make sure that you feel really strongly about the product that you're launching because there are going to be hundreds of times across the journey where you're going to feel like you want to throw the towel in and you need to have that deep, deep, deep-seated belief to keep going.

33:02Hannah Dittman:So inspirational. Could you be any cooler, Emily, an athlete, a founder, a businesswoman, a mom? You've got it all going on. It's no surprise why you've been so successful. You've got that resilience and that muscle ingrained in you clearly throughout your whole life in many different ways. And that comes through. And I think a great piece of advice, it is probably the hardest part of the early founder journey is just battling. I used to be an investor and I used to say investing is kind of like being an Olympic runner. It's how fast and how perfect you can go and how easily you can jump over the hurdles and how you can just win that race.

33:40Hannah Dittman:But I think being a founder is like being a boxer. It's like how many hits can you take and just keep getting pummeled in the corner and still be ready to get up and take another swing. I love that. I'm totally stealing that in out. It's not easy, but you're making it look like with enough hard work, it can be a little easier at least.

33:58Emily Groden:And great partners like Brian. Yes. I think one thing that Emily's whole story speaks to, or one piece of evidence that comes out of that story is, if you ask any other founder or investor across the startup CPG ecosystem, I'd say Emily is one of the more well-known founders in the space. And everyone has a positive impression of her and says she's awesome, right? And that's something that when investors are looking into investing in brands, ultimately are investing in the jockey, not the horse. The horse is important, but the jockey is even more important. And I think the impression that Emily has made on everyone across the CPG community is clearly very strong from all of the feedback that we got from others.

34:44Hannah Dittman:Brian, if you could give founders one or two pieces of advice about fundraising, given all of your experience and your reflections on this experience with Emily, what would the pieces of advice be? I think, unfortunately, oftentimes the best piece of advice is cast a wide net. You should have your target list and definitely go to your target list of investors first and chase them all down. Get warm introductions. Don't go in cold. I can't tell you how many times I get a cold inbound and it just gets lost in the fold because I don't have someone flagging it for me. So I try to respond to everyone.

35:20But if you can get the warm intros, highly advocate for that. Be willing to kiss a lot of frogs. It's going to be a hard journey and you're going to get a lot of no's before you get any yeses. So definitely be willing to have that endurance to keep going. I've never done an Ironman like Emily has, but it sounds like it is an Ironman type of journey to fundraise and capital is not easy to come by. Be sure you have your story crisp, I'd say, and that vision for where you will be crisp. A lot of times we speak to founders who are either obsessed with their one product, which is great, but don't have a vision for where the product platform can go.

35:57So think about yourself as can you become a platform? Is there a right to win across your category outside of just you have one great skew? And this is often somewhat overused, but I'd say making sure that you have a reason for being and you're really solving a problem. And for Emily, I mean, I remember growing up during elementary school and it was that similar issue that Emily faces with her daughter where I was rushing out the door every morning and my mom would pop in an Eggo waffle and I'd have one wrapped in a paper towel on the way to school. And looking back on that, those had hardly any nutritional value, but they were solving a need.

36:38They were solving this convenient breakfast in a quick amount of time. So what we saw with Emily was that she was truly solving a need by providing that convenience while also providing something that was nutritious. So think about what need you're solving as you're fundraising and being able to message that to investors.

36:56Emily Groden:Just to jump in on the Casa Wide Net comment, definitely Casa Wide Net. You're going to get so many no's. But also, I think it's really important to reframe those no's and realize that like a no today isn't necessarily a no tomorrow. It's also not necessarily a no to you. Like it might be where that fund is in their fundraising process, right? Or how big you are relative to the fund. And so as much as possible, if you can not take those personally and just keep your chin up and keep going, that will be very helpful. I also think too, if you have the great fortune of having choice, I have tried to be really thoughtful about who I have around the table.

37:39Emily Groden:And this is also with hiring too. Again, this is my first rodeo. I knew nothing about this industry going in. I am nothing though, if not coachable, like I said, former athlete. And so I tried to surround myself very intentionally with people who know a lot more than I do and also making sure like I'm plugging every hole. And so when I look at my investor team, family is what they really are. And when I was talking to the RPV team, they bring this incredible operational expertise, which we didn't yet have around our table. And they happen to have incredible operational experience with frozen breakfast food, too.

38:17Emily Groden:And so it was like the most specifically perfect operational expertise for us. And so feel so blessed to have them around our table.

38:27Hannah Dittman:So well said. And you guys have such an amazing rapport and relationship and respect for one another. It seems like such a symbiotic and natural fit based on what you're building and working on and all of the experience that RPB has. But also Brian personally, I can see why you guys have hit it off so well. And it's hopefully such a fruitful investment for you. Just quickly, I'd love to take a second to touch on explicitly if you could describe what the investor-founder relationship feels like or looks like. What types of things are you working on together? And what could be helpful for someone else to know as they think about finding their perfect investor fit as well?

39:07Yeah, I'd say it's somewhat of an accordion when it comes to how often you'll be interacting with your investors and it depends on where you are in your journey. We are an open book when it comes to we're always available. So there's definitely been periods where, and I'd say up to now, more often than not, we're on calls with Emily or someone on her team on a weekly basis, sometimes more than once a week. And it's something where we always want to be available. Obviously, your investors will be there for you during your quarterly board meetings and be on the board meetings and ask you questions and push you in certain ways to think about things differently.

39:49But I think it's something that you will interact with your investors differently, depending on whether you're fundraising or if you're going through big strategic decisions, or you're building out your board or you're launching new products. I think any of those big strategic decisions, it's helpful sometimes to get different perspectives on outside of your own bubble within your own company. So I think it's different for every investor-founder relationship, and it's different for every period of time in the founder journey.

40:20Emily Groden:Yeah. I mean, we talk a lot, but that's what my hope was for this relationship. And I think I view all of our investors, RPB included, as true extensions of our team. To me, what's the point of bringing these folks on if you can't learn from them and include them in these difficult decisions. I think that I take a stance of the more transparency, the better. I want to share my wins with Brian. I also want to share my challenges with Brian. I actually, before RPB invested, I was dealing with an operational challenge and I called one of our investors to kind of use him as a sounding board. And at the end of the call, he was like, it's so refreshing that you would like think to call me when you have a challenge that you want to talk through.

41:06Emily Groden:Like so many founders hide from their investors when they have a challenge, they want to talk through. And I was like, I just think you have to reframe that relationship and realize like, it's not like a founder versus investor. Like we are all on the same team here. And founders have so much to learn from investors that I take the open book stance. And it's been incredibly helpful for me. I've learned so much from all of our investors. Again, to my earlier point of like trying to fill certain seats around the table, like RPV is incredible on operations. We have other investors who are incredible on marketing.

41:39Emily Groden:And I just like my investors are often my first phone call. I think what you also have to realize as a founder is investors have the fortune oftentimes of speaking to dozens of companies a month. And we could see trends. We could see where the market's going. We could see what's going on with different retailers. And if you're struggling with an account, we can say, oh, yeah, we've heard that from other brands as well. Obviously, we keep everything that's under an NDA private and we don't share that with our investments. But you should think about investors also as having this kind of bird's eye view of what's going on in the market and what trends are really picking up or what trends are dying down because we have the fortune of being a little ADD and talking to everyone.

42:22Emily Groden:I think, too, one of the things I always do before accepting an investment when I'm fundraising is I always make sure to talk to other investments of that fund, right, other founders, and just understand what their experience has been like. because I want investors who are willing to roll up their sleeves and get their hands dirty and help us work through things. I want investors who are level-headed and, like I said, are there to celebrate the wins but be supportive when we're working through issues. And there's, like, no better way to do it than to talk to other founders who are currently working with them.

42:58Hannah Dittman:So well said and so many great points to chew on and to think about for other founders out there. I could sit and talk with you guys all day, Brian and Emily. I want to be part of your little friend group and your syrup club. You're part of it. I feel like you guys have such a great dynamic and it seems like so much fun to be working on the things you're working on together. I'd love to pivot into a Slack question quickly. As you know, Startup CPG has the largest Slack community in the industry with now over 35 ,000 members. I'd love to pull a question directly from our channel and have you answer it as a case study for any founders with a similar question.

43:33Hannah Dittman:Today's question is, how can I craft a compelling pitch for my company? How do I think about building the narrative?

43:40Emily Groden:When I think about this question, I often think about like, who would I invest in at this stage? And I think there are a few things that have to be table stakes in your story. One, I think you do have to show your relentlessness as a founder and that you are the type of founder that's going to run through a brick wall because that's required of every founder. Two, and Brian mentioned this earlier, you really do have to have a differentiated product Because every conversation you're going to have with a retail buyer, the retail buyer is going to ask themselves, I've got very limited shelf space.

44:11Emily Groden:I've got these products that are performing well. Like, what does your product do for my set? How is it going to grow my category? And ultimately, that's what investors are looking forward to, right? Like, how is this product going to get brought onto shelves and grow this category? So truly differentiated products. Like, don't just make a me-too product. It's got to be different than what's out there and incremental to what's already on shelves. And then three, I would say, like, to the extent that you have access to data, tell your data story. And it depends where you are in your fundraising journey.

44:44Emily Groden:But showing baseline, strong velocity foundation is super important. I think all investors recognize that your velocities are going to grow from there. But you need to show that there's at least some, like, true product market fit and there's interest in the product from day one. So I think those are like the three things that are most important. And again, in the Series A, they're really interested in our unit economics. What investors are looking for is going to differ and change with every round. But I think kind of in the beginning, like relentless founder, truly differentiated product and strong baseline velocities are the three things you have to have.

45:21Yeah, I agree with everything. I think it's also just having that big picture, bigger vision for where you could go. And obviously, you want to be focused. And Emily mentioned, that's really the most important thing that we want to identify with any investment is the founder's focus. So you need to have that focus, but you also need to be thinking kind of that long term vision of where you could go and your right to win to get there. So I think, yeah, Emily hit on all the other points that I would have mentioned. So I think it's definitely an art and it's something that not everyone's great at.

45:53So recommend consulting with others, talking with other founder friends or warm investor relationships to try to identify and practice that story before you go to market so that you can hit the ground running once you do.

46:07Emily Groden:And I think to the extent at all possible, like have fun with it. Brian, tell me if I'm wrong, but you can probably tell when a founder is enjoying the process and view it as an opportunity to add to your bench, right, to deepen your bench and add to your team versus like this scary situation where you're on trial. it should be it really is it is a marriage it is a team it is a family and so if you can view it in a positive light like i get to add these awesome experienced people to my team i think the whole

46:38Hannah Dittman:thing goes smoother i love all those pieces of advice i think mental state and also the proof and the promise that you guys are talking about it is so well said and worth a double click and definitely something for everyone to keep in mind this has been such insightful and fun chat with you all. Your energy totally comes through and your passion for what you're building. For founders or investors or anyone else that may want to continue the conversation and get in touch with you both, what's the best way for them to find you? And second part of my question, do you have any advice or current opportunities for those interested in joining either of your teams or industries?

47:17For me, I'd say best way to get in touch with me is likely over LinkedIn is Brian Bernstein with Rich Products Ventures on LinkedIn. So feel free to send me a message. And we're a small team. It's three of us. So unfortunately, no opportunities to join us currently. But if you want to build a relationship with us, share deals with us, feel free to reach out. And if there's something for us to connect about, I would love to chat.

47:42Emily Groden:LinkedIn's probably best for me as well. I think I'm Emily Cole Grodin, my maiden name up there. And you can also find Evergreen at eatevergreen.com. We have an awesome store locator that can show you where you can find our products. And then on social, we are at eatevergreen. We are hiring for a couple roles. I believe they're posted on LinkedIn, both in operations and marketing. So take a peek.

48:07Hannah Dittman:Well, hopefully you get some good canvassing from the Startup CPG community and we get those roles filled for you. everyone go out get yourself some waffles treat yourself and have a good morning starting with evergreen thank you both so much for joining today can't wait to continue on your journey and watch all the amazing stuff you continue to do thank you awesome thank you well friends we've now arrived together at the end of another episode of the startup cpg podcast the top globally ranked podcast in cpg and if you love this podcast you'll love our slack community even more. Here at Startup CPG, we're a community of brands and experts, and you should join.

48:47Hannah Dittman:Sign up at StartupCPG.com. You'll then get an invite to our online Slack community of over 35 ,000 all-star CPG members, hear about amazing events near you, and all our special opportunities to get you in front of buyers, investors, brands, and more. It's a free community. So what are you waiting for? I'll catch you on the next episode, and I'll see you on the Slack.

49:15Thank you.