The Startup CPG Podcast

Laurel Orley
So we actually use the turmeric. We use the nutritional yeast, obviously, sea salt, but then to activate turmeric, we use a pinch of pepper, black pepper, and that activates it. So the nutritional properties can go to use in your body. And that's something that I didn't know previously, that you need to have black pepper to kind of activate the turmeric.

00:34
Tim Richards
You know, we are. We're fermented, but we're also sprouted. And so I'm sure you've heard a lot about sprouted from Laurel. Basically, it makes the almonds sweeter, more digestible, more nutritious, and you achieve that by soaking it in water, typically overnight, and then the next day, you drain it, you dehydrate it. So we're basically, we're sprouting it, but instead of draining it, we're letting it soak for, you know, basically almost two weeks. And beyond just putting in water, to that water, we're adding salt, and we're adding probiotic cultures.

01:04
Daniel Scharff
Welcome, everyone, to the startup CPG podcast. Today's episode is a double dose. You're going to hear about two of the hottest brands out there, Daily Crunch and Philosopher Foods. They have something major in common. Can you guess? They both use almonds. Daily Crunch popularized incredible flavors of sprouted almonds. And Philosopher Foods has Gut nuts, which are these fermented almonds that are so delicious, it's like a nut version of sourdough bread. They both pack a serious punch and a serious crunch. Today, I'm so excited to dive back into this world of nuts. We're going to understand these new innovations, processes, what's driving consumer interest, and a bunch more. Thank you so much to our friends at the Almond Board of California for this episode. You can learn all about them and their resources@almonds.com all right, enjoy. Let's get nuts.

01:54
Daniel Scharff
All right, Laurel, welcome to the show. I'm so happy to have you on here. Just one of my favorite founders, and I also am very happy. Yeah, you've got your product there, and I have it as well. So I've got in front of me the Daily Crunch turmeric and sea salt flavor, which is one of my favorites. And I have distinct memory. I think it was when I still lived in San Francisco, maybe like, you know, four years ago or something, getting this for the first time. And I'm like, well, I've never really had, like, a turmeric flavor that I have really loved, but let me try this. I was like, well, I love this. I guess I do like that. I mean, wow, what a unique flavor. And then I also remember then being like, what does sprouted mean? I really didn't know.

02:36
Daniel Scharff
And I think you actually gave me a really good explanation then, and I would love for everyone to hear it. So do you mind just starting us off with, like, the Daily Crunch 101 and maybe also a Sprouted 101?

02:45
Laurel Orley
I would love that. Everybody listening to feel like they have learned so much more about nuts and that they after they listen to this podcast. I mean, it is just the gift that keeps on giving. I can go really deep on this. There is a rabbit hole that we can get way down with nuts and sprouting.

03:03
Daniel Scharff
Let's get nuts. Let's do it.

03:05
Laurel Orley
Let's get nuts. You know, we have our values as a team, and one of them is, it's just nuts. It's just nuts. But it's just nuts.

03:12
Daniel Scharff
We welcome all puns. Just if you want to throw a bunch out, then let's just get cracking.

03:17
Laurel Orley
So my Aunt Diane, she learned about sprouting nuts and seeds in the southern banks of India over 20 years ago. Her sister was going to India. She would visit her sister and she would see people soaking nuts and seeds. They did this for brain health purposes. She was really intrigued by the process, and she took it a step further back in the US with her special dehydration methods. Fun facts that anything above 180 degrees is considered roasted. So we actually have our nuts and seeds dehydrated under 180 degrees, so they maintain or retain all their nutrients while we're not considered raw because that would need to below, I believe, 118 degrees. We're not roasted. So I didn't know that. Sprouting is basically this process to get towards germination where the nut is a seed and it can turn into a tree or whatnot.

04:13
Laurel Orley
So sprouting is the beginning of that germination process. Well, obviously we don't get that far. But when you soak in essence seeds in water, it sheds something called phytic acid, which is anti nutrient. So when that is removed from the nuts and seeds, it makes it something called more bioavailable, which makes the nutrients of the nuts and seeds absorb in your body a lot faster. But removing all of that from the picture, we're called daily crunch because of our texture differentiation. So close your eyes and envision like a bare apple chip. A bare apple chip is just a sliced apple in a dehydrator, yet it transformed the texture of an apple to A chip. And we are giving a different texture differentiation to nuts and seeds, hence bringing innovation to what we call a trusty but very dusty category.

05:08
Daniel Scharff
And while everyone has their eyes closed, listen to this. That's what is. That's what it sounds like. They're super crunchy. It says on the front, uniquely crunchy sprouted nut snacks. So now I understand why it's delightful how crunchy they are, because I'm just way into crunchiness in general. You know, I never really thought about that as an attribute that people really seek out. But Quinn from our team is like, I'm very into crunchy things, and he knows that about his palate, and he's going to seek that kind of stuff out, whether it's candy or whatever it is. Like, man, I guess I really like that, too. They're super crunchy. So now I understand why they're so crunchy is because of the hollow core that you say. Because when it. During the sprouting, so they actually expand and then creates that hollow core.

05:52
Daniel Scharff
So that, in addition, probably to the texture that you have on the outside, give it that overall crunchiness. And I will say, in the bag that I have here, it was lovely. Some of the almonds actually kind of like, stuck together a little bit. And then I had just like a just really nice little bite. Pair of just absolute crunchy little pellets. It was delicious. You know, the interesting thing to me about this product, which is delicious and doing obviously extremely well, is I just, like, sat here for two minutes trying to figure out how I would describe the taste of it. It's very difficult to do. I feel like I'm pretty good, I think usually at just being able to put words to the kind of flavor that I haven't. It's hard to do with this, I think, with.

06:31
Daniel Scharff
Even with almonds in general. Can I tell you kind of like just some of the words that I was coming up with, and you can tell me what usually here. So obviously, there's like a little bit of, you know, saltiness or, like, you know, savory that you get from this flavor, which is turmeric and sea salt, this particular one. But then, like, you get the, like, kind of meat of almond in there, and it, to me, it's like, yeah, it is clean, like kind of just like a clean taste. A little bit creamy for me, and just, like, textured throughout. But it doesn't like. Yeah, it's like creamy butter or something. I don't know. But it doesn't, like, scream of any Individual flavor that I could pick out. But the overall experience is just, like, you know, crunchy and delicious.

07:10
Daniel Scharff
But, yeah, I'd find it really hard to, you know, give a lot more words than that. What do people usually say or what do you think it is?

07:15
Laurel Orley
This flavor is very personal to me because when were really, really bootstrapped, roll up our sleeves before, we had an R and D person on our team, which we have now. You're looking at the cook in the.

07:27
Daniel Scharff
Kitchen like, it's so good.

07:30
Tim Richards
So.

07:31
Laurel Orley
And I think there's something just so beautiful about that, because I know a lot of people listening are startup brands. And, you know, you see this evolution of your brand over time of. I'm just like, thank goodness we have someone who is an expert in their field who now does R and D for us. But this flavor actually came from my kitchen, where we wanted some type of umami, like, savory flavor. But we realized even back in the day that we wanted to create flavors that were different from what already existed. We didn't want to just have a flavor that our competitors already had. We wanted it to be unique to us. So we experimented with just, you know, turmeric is a superfood. There's so much, you know, anti inflammatories.

08:19
Laurel Orley
I believe were reading one of the whole foods, like, top 10 trends that year, and one of them was turmeric. And we're like, let's do something with turmeric. So we experimented with also nutritional yeast. And I didn't realize this until recently, but, you know, nutritional yeast is fortified yeast, and there's so many incredible nutrients in there. So we actually use the turmeric. We use the nutritional yeast, obviously, sea salts. But then to activate turmeric, we use a pinch of black pepper, and that activates it. So the nutritional properties can go to use in your body. And that's something that I didn't know previously, that you need to have black pepper to kind of activate the turmeric. So.

09:04
Laurel Orley
And no spoiler alerts, but we do have two new SKUs launching this fall, and one of them is a savory flavor that we probably, you know, maybe should have done a while ago. But, you know, that kind of salted skew that everybody wants, but this was kind of our salted skew, that savory flavor that's not too polarizing.

09:27
Daniel Scharff
Well, I don't feel like I can think about anything else until you tell us what it is. So I'm like, I'm dying to know now. You don't have to tell me now, but just tell me before you tell anyone else.

09:38
Laurel Orley
After the pocket is over, I'll tell you everything.

09:42
Daniel Scharff
You know what I would. You know what I would love? I'm probably alone in this, though, is I don't know if you ever ate sunflower seeds when you were a kid, but I played baseball. That's what we did, because all the big leaguers had their chew or whatever. So we did sunflower seeds, man, the ranch flavor, I would just go nuts for all day. I don't know if that probably doesn't fit with your positioning, but you could just make, like, one bag for me. That would be great. Thank you.

10:04
Laurel Orley
No, I. I hear you. We. That's definitely been on our radar. Like a ranch, maybe a honey must. There's so many incredible flavors that you could toy wood. And I think what's so interesting about what makes, you know, sprouted unique is that because we soak it in water, you don't have to just, like, you could add flavorings also to the water, which we're starting to experiment with. So we had a coffee and coconut flavor where we soaked it in, like, coffee, and it had this coffee flavor. I think it was confusing for consumers because it wasn't salty or sweet. And we may bring it back if we partner with, like, a coffee company. But the fact that we could. Almonds absorb flavor from all around, so there's just a lot of opportunity.

10:51
Daniel Scharff
You know, I was talking about the taste before, but do you feel like almonds are kind of like that a little bit? Almost like a canvas in some ways, where you, like. There's just a lot that you can do with them because they're like. Yeah. Like, they're not overwhelming with their own taste, which is good and clean and, like, nice. But it seems like you're able to really do a lot with them.

11:09
Laurel Orley
So much. I mean, I have to be honest. I'm constantly learning more about almonds. We have someone on our team who is regulatory to make sure that any claims we say or do are approved by the fda. And she told me last week, she said, laurel, is there a reason why you don't have the decreased calories for almonds? I said, what are you talking about, Amber? She said, almonds, you pass through. I hope I say this right. 19% of almonds pass through you where, like, the calories don't get absorbed. And she said, the FDA has approved remove, like, 19% of the calories. I said, amber, like, you had lower calories, like, as long as The FDA approves this. Like, let's put this on our. She said, I don't know why I don't do it. A lot of your competitors do it.

11:59
Laurel Orley
And the truth is, I think sometimes people see almonds and say, oh, there are all these calories in there, or fats. But the truth is that these are good fats. They're an excellent source of so many different things. And it's not recreating the real. We already know what almonds are. We're just making it a little fresher for consumers.

12:21
Daniel Scharff
Right. Well, I basically how I interpret what you just said is that before I was going to eat 100 almonds, but now I will give myself license to eat 119 because I'm going to pass through 19% of them. This is not approved by the FDA. Do not consider that to be regulatory information, please. That's awesome. So you mentioned before about how, like, you know, originally some people were soaking these and then, you know, eating them for brain health. How come they were thinking about them from a brain health perspective at that point? And like, how do consumers now think about, you know, sprouted and almonds and the benefits that they associate with them? Yeah.

12:56
Laurel Orley
You know, even though Diane, you know, learned this process from India, we don't really like. Our story doesn't is, you know, really starts with her back in the US with then dehydrating them. I've spoken to so many of my friends or people I've met over the years who, if they have family members or their grandparents or they grew up in specifically India, they'll say, oh, I remember my mom or my grandparent would soak nuts overnight and we'd eat them in the morning and maybe take the skin off or when they're so wet and it was like, good luck or all these things. And I think that all different types of foods or drinks, there's a time and a place when it's really going to resonate with consumers.

13:38
Laurel Orley
And 20 years ago, sprouting probably would have just stayed in the natural channel because I don't think consumers were ready for it. I also believe that one brand alone can't carve out a whole category. It has to be brands working together to really communicate to consumers. Proposition the difference. I mean, I look at coconut water. It wasn't just one brand. It was multiple brands that brought coconut water as a category. And, you know, it started with sprouted breads, sprouted this, sprouted that, and now it's moving into sprouted nuts. And we have been Successful at retailers like Meijer. That is a conventional store. We've been in there for almost four years, and we are growing year after year with our sprouted. So it's. This isn't just natural. It is.

14:29
Laurel Orley
I think we're winning in natural because of our health benefits and our taste and crunch, but we're winning in conventional because of the crunch and the taste. And it just. I do believe that this is the time that consumers are ready for Sprouted.

14:45
Daniel Scharff
I love it. I mean, I think even if you didn't know anything about sprouted or almonds, people would just taste it and be like, this is good. I want to eat a lot of this. I have to restrain myself from not crushing this whole bag right now, just pausing the recording and just going off into my little hole and just eating the whole bag. But I will refrain for now. So obviously, like the. For you, the almond is the hero kind of ingredient in this. Can you tell me about what it was like to find the right almond and you know why? California almonds, all of the good stuff.

15:12
Laurel Orley
Every year there is an almond bloom. So we get a pulse from our California farmers to understand the bloom of. Okay, did it meet expectations? Is it below?

15:24
Tim Richards
Above?

15:25
Laurel Orley
It was really important to us that the almond size that we source for daily crunch were more on the larger size because that's what's going to make them swell and get like a bigger crunch. So we work with a farm in California that is one of the larger farms, but they also worked with our kind of sustainability mission of they are part of the almond project with regenerative agriculture testing that. We actually just joined the almond project. They're part of the bee pollinator effort. So actually, our new bags that are going to rolling out already, they have our B certification on the back because of our almond farm, and they use special drip irrigation methods. But there's also different types of almonds. So there's supreme, there's nonpareil. So we actually source non pareil on the larger size.

16:19
Laurel Orley
We're testing out different types of almonds to see how they sprout and crunch. We're just really sensitive to, like, they have to crunch really loud. And we've been really happy with the type that we have. But if you're a bar snack and no one's going to individually have your almonds, it doesn't really matter what size they are. But there's a whole line of different types of almonds and different sizes.

16:48
Daniel Scharff
I gotcha. I would like to know what the testing Process is like for the crunchiness of the almond, if you have like a decibel meter or something. And who is the person who's responsible for crunching them and how do they do it? Traditional method or if you have a special cruncher.

17:03
Laurel Orley
So we did something on the View a few weeks ago and it was like a live segment that I went on and at the end I was going to crunch and my kids were like, mom, what happens if you bite into the almond? If it doesn't crunch? Like as I was like, guys trusting the system. It's going to crunch. So going to crunch and they're going to hear it. And they were so nervous for me. Like, I don't know if maybe you pick up the wrong one. It crunched, it was fine. But we thought about doing a trade shows. We're like, we should do something at trade shows like Expo west next year where people can put on like a headset and it's like what, decibels higher, like a chip or an almond crunch. So we've been toying around.

17:42
Laurel Orley
So if you have any ideas or anybody on this listening, please email me.

17:47
Daniel Scharff
I just have an idea for a jingle that you could do that would be like the lollipop. Like lollipop. Oh, lolli lollipop. Did I. I think I timed the crunch right on that. I'm glad it worked. All right, let me. I'll bring us back to the topic at hand here. So what about like gut health? Can you tell me a little bit about that trend? And do you think people look towards sprouted a lot for gut health? Do you think we'll see a lot more sprouted products of all kinds?

18:17
Laurel Orley
So gut health is really big right now. Obviously, you know, we always say what you eat is how you feel. It all goes hand in hand. All ladders up to brain health. And you know, while you can't be everything to everyone, I have had a lot of people email us saying I had so much sensitivity to nuts and seeds and with sprouted, I don't like. They don't. Doesn't bother my stomach. And almonds are a superfood. I think people forget that there's so many powerful things within what almonds have. So our new packaging actually, you know, calls out a lot of what. This includes vitamin E, magnesium, riboflavin, biotin, copper. Like so many different areas. We know that's a heart health snack. Gut health is another thing that it's so great with your gut.

19:13
Laurel Orley
So I think that more and more consumers are just want to know what they are putting into their bodies. They want to know, you know we also are a good source of fiber. There's so many things that almonds specifically already have that. Why try to recreate the real with that somewhere else?

19:35
Daniel Scharff
Okay, amazing. So I'm switching gear a little bit because Daily Crunch is one of the few brands that I can say I remember when they were early on and now they are everywhere. Especially like I see your brand in just some of the most random places where I'm like at an airport kiosk I'm like I'm not going to know any brand here for sure. But then you guys are there. So yeah, like you were saying, you know, you're not restricted to the natural channel or even the high end grocery. You're everywhere and you're winning there I think because you have a product people are looking for and just you know, good crunch, good taste, all that stuff. Can you just tell me a little bit about how did that all come to be?

20:10
Daniel Scharff
What was your strategy that really just catapulted you to so many great points of distribution?

20:15
Laurel Orley
Yeah, I mean we've had an omnichannel strategy from the beginning where we're not a DTC brand. We launched during the pandemic and we really had to throw that consumer package goods playbook out the window. And I think that's also one reason why we launched more in conventional in meijer to start versus like Whole Foods and we have 12 month shelf life. And one thing I I've also learned along the way is the formats, the price pack architecture of how the different size packs of our products can fit into different areas of consumers lifestyles. So we have our four ounce pantry size. We're right now in works of talking about some bulk items for E commerce that can work really well.

21:06
Laurel Orley
But then also you have these you know, 1.5 ounce grab and goes where people just want to grab and go and have something in their bag in their car. At the airports there's just this massive opportunity where consumers want cleaner products. There's not a lot offerings for that. And we had the opportunity to work with WH Smith and Chibo Express early on where they both took a chance on us. And with WH Smith, you know, it was a small test to start with Chibo. This is year three that we are with them and working with them to elevate our brand. And the visibility in airports is phenomenal because if you think about it after the pandemic, everybody's traveling now and everyone's at the airport, and everybody wants to get food at the airport.

21:58
Laurel Orley
So I can't tell you how instrumental that visibility has been for us with getting into the airports.

22:04
Daniel Scharff
I love it. It feels like for me, travel is just one of those times that you're gonna snack. If you're going on a road trip, you're going on the train, you're going on a plane. Just know you're gonna snack before you do anything else when you're on the flight. Flight or whatever. And so I think, yeah, Chivo is a very impressive assortment. When you go into Those stores, like W.H. Smith, obviously very present in that whole channel. And then the Chivo stores, when you go in, you're like, oh, this kind of sort of feels like I'm at a trade show for, like, Expo West. But here in the airport, like, this is a very highly curated set here. So I can really see, like, you know, you're going to snack, but you also kind of want to be healthy.

22:40
Daniel Scharff
And so here's your assortment of all of your snack options there. So it doesn't surprise me that you have done very well with them.

22:46
Laurel Orley
Quick, funny story is I was with my kids, I think, in the Dallas airport, and I was, like, hiding behind a pillar at Chibo Express, watching this woman, like, pick up all of our bags and, like, reading the back of it. And I was, like, sitting my kids and, like, should I go up to her? Should I say something? And my daughter's like, absolutely not, Mom. Like, it is embarrassing. Like, stop embarrassing us. Then I saw her pick up. I think she took the Nashville ha. And she checked it out, and it was just like, I love seeing people in the wild buying our product. It just means everything to just see that and. And to actually see them reading the bag, reading the labels, probably feel very.

23:23
Daniel Scharff
Seen when that happens. Like, you chose me. I thought the story was going to go somewhere else where you were talking about, like, I was in the airport and I was hiding behind a column looking at people, and then I got in trouble.

23:35
Laurel Orley
I was just listening. When I go to the airport, I have this guilty pleasure that I buy Us Weekly and Cool Ranch Doritos. But I typically eat healthy.

23:44
Daniel Scharff
I really feel like just after this podcast, Ranch is a shoo in for one of your flavors. So I look forward to being the taste tester for that. Okay, so just as we come to the end here, I wanted to ask because obviously we have our friends at the Almond Board of California And I know they've been pretty helpful to you and you know, when you have this kind of a product where there is one of these commodity boards, they can be really helpful. Do you mind telling me a little bit about like how partnership with them has helped Daily Crunch?

24:10
Laurel Orley
The Amin board has been instrumental. Well, first of all, especially when you're an emerging brand, data is extremely expensive. And the almond board puts together through their own data sources to understand all the key trends and we get everything from them. When it comes to the data sourcing, they also help us with understanding, you know, testing. Look, sprouting is still something that's relatively newish. Wood nuts and seeds. There's a lot more tests that we want to do and they have been partners with helping us get this testing done or seeing if testing already exists and has just been such a great resource for that. They also, you know, everything they're pushing when they do articles to elevate emerging brands. You know, with almonds, it's great to have them in our camp as a resource and continuing to be that for us.

25:04
Daniel Scharff
Yeah, I can see that being really helpful. That data especially, you know, specific to almonds as you're doing your sell in to retailers, investor pitches, I bet there are just a ton of really good nuggets that you can get in there because I think you know that this kind of stuff is doing well. But you may not know exactly why and understand all of those trends. And to have maybe a research partner just who's able to feed you a lot of that really important educational info I think probably helps you really? Yeah, really round out the pitch.

25:31
Laurel Orley
I always believe the data tells the story and that they make this accessible for brands that source almonds. It's invaluable.

25:40
Daniel Scharff
Okay, well, Laurel, I'm going to wrap us up here, but I just want to say congratulations again because the success of your brand has been so much fun to watch. Seeing you guys grow from just a product that we all loved to something that is now loved by so many people everywhere is really great to see. And obviously you're just deserving of all of that success and doing a great job at the helm and it's just wonderful. So thank you and I really appreciate you taking the time to educate all of our listeners here a little bit. And can you just tell everybody how they can support you in Daily Crunch and get their hands on some or follow you, whatever you like.

26:13
Laurel Orley
Thank you so much. Well, we are in Whole Foods nationwide in the nut section and actually the turmeric and sea Salt, our dill pickle, and our sweet festuan are all there. And if you want to try us, we would love support to try us at Whole Foods. And obviously I feel like, you know, we're all in this together, so I always love to be part of what you're doing and any way we can all help each other, but that's my shout out. Whole Foods turmeric and sea salts.

26:41
Daniel Scharff
All right, Laura, which is your favorite flavor? Just tell us. We know you have one.

26:45
Laurel Orley
This is a hard one, I'll have to say. Our spice pear in yogurt right now is my go to breakfast item. I'm obsessed with it.

26:53
Daniel Scharff
Whoa. All right. We got our hands on that turmeric and sea salt.

26:57
Laurel Orley
I've been eating a lot of those too, as well, so.

27:00
Daniel Scharff
All right, all right, Laurel, thank you so much.

27:03
Laurel Orley
Thank you.

27:05
Daniel Scharff
All right, everybody, we are so excited to have Tim here from Philosopher Foods. Tim makes gut nuts. It's your favorite nutrient dense, super nut. Tangy, crunchy, and dehydrated. Never roasted. He's nuts about prebiotics, put probiotics and postbiotics. He is your friendly neighborhood microbiome booster. Tim, welcome. Can you hit us with an intro, please?

27:27
Tim Richards
Good to be here, Daniel. Thanks for having me. Love what you built. Startup cpg. So I'm Tim Richards. I founded Philosopher foods back in 2013 in my home kitchen. And you know, you gotta do something with a philosophy degree outta college. So that's what I started doing. Started making nut butters in my home kitchen and 12 years later, still doing it. And also making some fermented snack nuts now called gut nuts.

27:46
Daniel Scharff
So you obviously have been doing this for a minute now, but it seems to me like recently you've gotten on a lot of people's radar. Like, I heard about you. You were at one of our events, just crushing it. I love this product. I hope everybody knows that. So what's going on now? Do you think that's really, I would say, getting you tons of visibility and interest?

28:06
Tim Richards
Yeah. So like I said, I mean, Most of that 12 year journey has been the sprouted almond butters. They're super good. They're delicious, nutritious, ethical, ecological. They're kind of like the Rolls Royce and nut butter. Really, you can't get any higher quality. But at the same token, that makes them super premium. So they're not as scalable. Nut butter's not as exciting as a category. Basically, what happened was one day, my home after the, we moved out of the home kitchen to a new commercial production facility. And I was sprouting the almonds to make the almond butter. Came in the next morning, and the almonds were bubbling. I thought, oh, my God, what happened? I just ruined all these almonds. I was going to throw them away. And I caught a whiff of sourdough. I was like, wait a second, I know that smell.

28:40
Tim Richards
I think these might have wildly fermented. So I tried it. And sourdough almonds, they were delicious. So that's how gutnuts were born. I was happy. Accident. I like to call it my snacksident. And, you know, it took a while before I really started R and D on commercializing the product. So the snacks didn't was in 2014. I actually didn't start R&D until 2020 on that product, and we didn't launch it until the end of 2022. So, as you say, we first showed up at Expo west with it in 2023. Really only been on the market for two years, and we're kind of blowing up on the scene because no one has fermented nuts before. It just raised a lot of eyebrows. And when they eat nuts, they're used to sweet. Maybe if they're flavored, they'd be savory.

29:16
Tim Richards
But when you get hit with like a tangy, umami, salty, savory sourdough nut, it's just like a whole new ball game. So it's kind of blowing minds and expanding palates.

29:25
Daniel Scharff
I like that. And there are a lot of reasons why I like it. And as I bite into my gut nuts here, fermented almond. All right. One, I love the crunch. Two, I like almonds. I love also just a little bit of flavors. Just something going on with the almond as well. Just to dial it up.

29:42
Tim Richards
Right, Absolutely.

29:43
Daniel Scharff
And there's something very special about the treatment that you've given these where it tastes interesting, you know? Yeah, it's sour. It's interesting in a great way. Not in a like, you know, sour candy kind of way, but just, yeah, like a sourdough kind of way. And it's almonds, which, you know, have this kind of great health halo around them. And so it just feels like you're eating something that's good for you and is just so snackable. And I love the crunch also. So it doesn't surprise me that you're getting this nice traction from people on this kind of a product. Can you tell me a little bit about fermentation? I am not good at science. I don't know what's Going on, I don't really understand it. Can you explain how fermentation works and what are the benefits of a product being fermented?

30:29
Tim Richards
Sure, yeah. Just as a quick disambiguation. So we're fermented, but we're also sprouted. I'm sure you've heard a lot about sprouted from Laurel. Basically, it makes the almonds sweeter, more digestible, nutritious, and you achieve that by soaking it in water, typically overnight, and then the next day you drain it and you dehydrate it. So we're basically, we're sprouting it, but instead of draining it, we're letting it soak for, you know, basically almost two weeks. And beyond just putting in water, to that water, we're adding salt and we're adding probiotic cultures. So we're actually doing a full on lacto fermentation similar to sauerkraut or pickles, but instead of cabbage or cucumbers, we're using almonds, cashews, and peanuts.

31:08
Tim Richards
So you could think of it as maybe pickled nuts as one way to think about it, but basically what happens is you add that lactic acid bacteria into the brine with the nuts, and they start metabolizing, they start rapidly increasing their numbers, breeding, and in the process, they excrete all kinds of different compounds that we call postbiotics, things like lactic acid. And basically that's responsible for that nice sour flavor that you get with gut nuts.

31:31
Daniel Scharff
Okay, that was very interesting. I feel like you might have missed your second calling as a professor, but I don't know if that's just because I always see you wearing the lab coat and you've got the glasses, and you seem very authoritative and knowledgeable and somebody who knows what's going on with science, which I've always envied as somebody who doesn't. But that's why I'm. I just am, you know, on the podcast here, so. So, okay, that makes a lot of sense the way you explain it to me. And also, Tim, you live in Santa Cruz Mountains like NorCal. Some pretty smart consumers, I think, in that part of the world who understand trends when they're just starting better than I do. Who are the consumers for fermented products and sprouted products and, you know, gut nuts in general.

32:13
Daniel Scharff
Do you feel like it's people who really have a good understanding of that and that's what they're looking for, or are they just like this? Tastes good. I like this. I'm gonna eat this.

32:19
Tim Richards
Yeah. I mean, the Latter is definitely the most important. People try it, they love it. And again, it's a caveat. It's a polarizing flavor. Like, not everyone loves it. Some people, they're not raised with umami kind of flavor profile. They didn't eat sourdough growing up. You know, and white bread exists for a reason, right? Not everyone likes sourdough. So, you know, we're not gonna appeal to those consumers. But anyone that likes tangy umami, savory, sourdough flavors, loves it. And then anyone that's already eating fermented food, whether it's kombucha, yogurt, kimchi, sauerkraut, you know, pickles, you name it, their natural target audience. So a lot of times when we see like user generated content, we'll see people cross posting it with like their favorite kombucha or with their yogurt or as part of their, you know, savory granola or whatever it is.

33:00
Tim Richards
So, yeah, the fermented foods tribe is definitely our core audience, but we're trying to figure out how to make fermented foods more accessible to a broader audience through snackifying them. You know, most fermented foods are cold, wet, mushy, and it's not a super snackable thing. You can't just like throw it in the bag as you go on a hike or take it to the gym or whatever. But the nice thing about gut nuts is it's. It's basically, you know, snackifying those gut health benefits of fermentation into a portable, easy to use snack nut and trying to make it conveniently available on the go.

33:28
Daniel Scharff
Okay, So I did not actually grow up with those kind of flavors. I don't think I grew up with kind of bland flavors. But I love this. So and so I was just trying to, like, reflect on why I didn't even really know what umami meant up until, you know, a year or two ago. So why do I like this? I think for me it's just because maybe it, yeah, it does taste a little bit like sourdough bread. But I have this feeling that I shouldn't be just sitting, eating a ton of bread on its own. Like, you know, I remember one time in my office in sf, I, were near a bread factory and I brought back just like a couple loaves of very lovely bread. And it was honestly like I had just brought cigarettes into the office and was smoking them.

34:08
Daniel Scharff
Everyone's like, whoa, no, I don't want that. Are you crazy? You can't just sit there and eat bread and offer us carbs and stuff. So I think I still have some of that, but obviously, like, getting the feeling of eating something just so satisfying, like sourdough bread, but in this really lovely, healthy feeling format of the almonds. I think maybe that's, like, why it just feels so good to me to eat these. So just one man's opinion, but also it is interesting to me that you make these up in. I mean, NorCal, to me, feels like the sourdough capital of the U.S. i mean, like, I never heard anyone talk about sourdough as a topic of conversation until I lived in sf. Is that right?

34:46
Tim Richards
Totally. Yeah. SF sourdough is a thing. It's like the yeast in the air. It's just. It's a thing. We actually. It happened, the snacks, and it was in Berkeley, so there was definitely some of those wild yeasts involved from the Bay Area.

34:58
Daniel Scharff
All right, so, okay, can you tell me then a little bit, like, what made you want to start with almonds? California almonds, obviously, we know a lot about. Can you talk about that?

35:08
Tim Richards
Well, you know, it was an accident, as I said, so it was a bit of serendipity, really. But the reason we started working with almonds originally is because I started the company in Davis, and so were basically surrounded by miles and miles of almond trees as far as the eye could see. And, you know, almonds are super healthy food, don't get me wrong, no matter how they're grown. And so I was inspired to think about, like, you know, how do we make this more like an ecosystem? Right. Rather than just like trees with nothing else, could we add some birds and grass and other animals grazing? Right. So I was really inspired to get involved with what I was calling at the time permaculture, which is now called regenerative agriculture.

35:42
Tim Richards
How do we create more of a regenerative template for these kind of orchards just to, you know, be. Look more like a forest and support more forms of life. So that's what really got me inspired to get involved with almonds initially. That and learning about sprouting through learning to be a holistic health coach and benefits of sprouting. So I kind of put those two together, and that's. That was the original impetus to start with almonds.

36:02
Daniel Scharff
And then when.

36:03
Tim Richards
Yeah, when they spontaneously fermented and made this novel snack, like you said, it's got this perfect crunch. It's got this craveable flavor. It just works. So, yeah, that's really why so.

36:12
Daniel Scharff
And, you know, I think it's still early Days. For people figuring out how to get on board with regenerative organic certified, which you guys have on your pack, what's that process like? Was it a lot of work? Obviously, it's really important to you. Was it, you know, how did that compare with something like an organic certification, which I know you also have?

36:29
Tim Richards
Yeah, for us, organic was a lot harder. It's more onerous paper process. For the manufacturer, regenerative is more like verifying that we bought regenerative organic ingredients from the farmers. And so most of the work for regenerative falls on the farmer. So they got to go through. They got to basically be traceable to the field level and not just like, oh, yeah, it's like, which part of your farm did these almonds come from? Right. It's super specific, super traceable, identity preserved, supply chain stuff. So for us, it's pretty easy. We just buy from the farm and then they kind of handle the rest. We do have to pay a premium on top of organic to be regenerative organic, just like the farmer. So, yeah, it's really.

37:05
Tim Richards
It's really just like adding on a layer of making sure they're doing above and beyond for soil health, above and beyond for animal welfare, and then above and beyond for worker pay.

37:14
Daniel Scharff
I know a lot of people in the industry are talking about regenerative. Are you seeing a lot of your consumers talk about regenerative, or do they know about it? Do they, like, understand the claim on it? Are they seeking you out because of it, or what do you think?

37:27
Tim Richards
I think our nut butter consumers are definitely aware of it and like, seeking us out because of it. But, you know, we're in a niche of a niche out here, right. In Santa Cruz and NorCal in general. So I'd say that most people that are finding gut nuts are just attracted to the branding, you know, the poppy look of it. It's a unique package. They're like, ooh, fermented. What's that? Oh, sourdough nuts. Interesting. You know, for gutnuts, it's more about the product experience and regenerative just kind of like an added benefit, really. Whereas, yeah, for our OG tribe of followers that we've had for 12 years, they're all 100% regenerative.

37:58
Daniel Scharff
Everything that is cool. Probably anybody who saw that movie Kiss the Ground was immediately looking to seek out anybody who was regenerative in any of category of food. That was a very convincing movie for anybody who saw it. Cool. Interesting. Okay, so Tim, you know a lot more about manufacturing than probably a Lot of people in our community who end up working with comans but you guys have your own manufacturing and I sort of picture you having just stepped out of your facility for a little bit to take this call with me.

38:27
Daniel Scharff
Can you just tell me a little bit about what it's like, what are some of the pros and cons to have your own process there and like what does that mean for your own personal time and how much you spend doing that versus how much time you spend on commercializing the business?

38:40
Tim Richards
Yeah, well I started day one making my own product in home kitchen so I was, I've been very intimately involved with it the whole time. We've gone through different spades of in house and co packing through the years and right now we landed on in house because well, frankly no one in the world is fermenting nuts. So we had a really hard time finding a co packer who would do it. We did find one but we had no path to profitability with them. So it was just kind of on the wall. If we wanted to bring this to the world, we got to do it ourselves. So the benefits are we have complete control of our process. The quality's through the roof. We completely own the ip.

39:15
Tim Richards
It's a patent pending process which is now protected by an additional moat of owning our manufacturing, you know, on and on. But you know, the drawbacks are it's more expensive, you know, things go wrong sometimes, machines go down all the time and just throw ranches in the works. It's just a lot to manage. And it's also very expensive to run a facility in California in particular. So you know, but all in all I wouldn't have any other way right now. And you know, for me personally I'm actually based in Santa Cruz. Our facility is in Santa Rosa so I'm only going there maybe once or twice a quarter. I'm blessed to have a team that is deeply experienced in fermenting plant based protein. Elliot Katzar, director of operations, he had his own tempeh company prior to this so he knows a lot about fermentation.

39:58
Tim Richards
And I never need to go up there unless I'm like doing a business trip or something and just want to stop by. So I'm really lucky in that regard. Now if he wasn't there then I'd be panicking, right. I need to either quickly find another director of ops that was as qualified or step in my stuff. Yeah, I love having the control. It does create a lot more headaches and a lot more logistics to manage but by and large I'm still mostly focused on sales and marketing despite the fact that we're, you know, doing the in house manufacturing.

40:25
Daniel Scharff
I was just thinking about how much I want to come for a field trip next time we're in sf, which happens a lot. And then I also wanted to ask, what do these taste off, taste like right off the line? Because there are a lot of products out there where when you get them right off the line, it's like, oh my gosh, it's so, so, so good. Like even if you know, you like the baseline product, like I used to work for Mars M&Ms, you know, and like you could go and do a tour of the factory and you could just grab one of the Peanut M M's off the line before they even put the shell on. And it was like the best Peanut M and M you'll ever have. It. Does it taste even like fresher when it's right off the line?

41:00
Tim Richards
Yeah, it depends on where in the process you grab it. If you grab it right when the brine has been drained, it's a little weird hearing a wet pickle, right. It's kind of like, what is this? So I wouldn't recommend that part of the process. But as far as when it comes right outta the dehydrator, when it's been dried and it's hot, oh man, you gotta experience it for yourself. It's just got that, yeah, that factor. I forget there's like a Chinese word for like hot, fresh out of the cooker. But it's that.

41:28
Daniel Scharff
Oh, that sounds so good. Hot gut nuts? No, nut gut. All the good stuff. So delicious. That sounds incredible. So what's your growth strategy by the way? Your retail strategy? Obviously now you have this pretty hot new product now that it sounds like, I guess has been in market for a little over two years. What are your goals? What are you trying to get? If there's a retailer out there that you really want, drop the name here, maybe they'll hear about it.

41:51
Tim Richards
Yeah, you know, we're definitely interested in growing nationally with Whole Foods. I think that's kind of the most obvious fit for our product. We are in NorCal and half the region currently. So we just launched in January and it's going well. And you know, we're looking to do more promotions and demos and all that good stuff to get it really flying on the shelf there at that velocity target that we have in mind to be interesting to national. But yeah, we'd Be loved. To be picked up by on the Verge. Right. To really groom us for that national expansion. Kelly, if you're listening, choose us.

42:22
Daniel Scharff
I love it. Pick me.

42:24
Tim Richards
Beyond that, we're going to be launching in sprouts nationwide in September, actually. Hey. Yes.

42:30
Daniel Scharff
All right.

42:30
Tim Richards
Thank you. Yeah, we had a good innovation set run last summer. Unfortunately, we had to wait a full year after that to hit the category reset schedule, but it's happening September 8th.

42:40
Daniel Scharff
So that's so good. Congrats. That's. I know. I mean, something like, you know, under, I don't know, 30 to 40% of people who get off who are on the innovation set now are getting off. So that's a big win for you guys. Does not. None of this surprises me at all. I love this product, but I am very happy for you.

42:55
Tim Richards
Thank you. Yeah. And just to clarify, it's going to be in the superfood section, which is in about 250 stores. So not every sprouts, but we are going to be in all eight DCs. And I don't know exactly the store list, but, you know, if they have a superfood set, we'll be in it.

43:08
Daniel Scharff
That's so good. And can you just tell me a little bit about your pack strategy? Because what I've got the three ounce bag. Do you have plans for single serve? What are you thinking?

43:19
Tim Richards
Yeah, we do. That's actually something we're thinking about for Sprouts innovation set, doing like a 1oz gut health kind of daily pack. We'll sell it in like a box of 10 and so you can get like three boxes, have your 30 day supply, one packet a day, one ounce a day serving kind of thing. So we're looking at that for a sprouts innovation launch. We're also looking at that for, you know, like the office corporate campuses of the world. Looking at you, Roger and Steve over.

43:42
Daniel Scharff
At Snackwise, honestly, that's exactly why I asked. I'm like, man, I would actually would love to connect you with some of our office providers who, I mean, gosh, I would have killed to have something this good in the office Snacks. Honestly, I would have had this every day and felt really good about it. You know, the problem is when you're in the office, like, usually you have to choose between the snack either being healthy or being good.

44:03
Tim Richards
Right.

44:03
Daniel Scharff
You know, exactly like this one. You get both.

44:06
Tim Richards
That's right. Yeah. Chat with Daria about, you know, their program over three guys. Yeah. We also do on our website, we do bulk bags so we do four pound bags. A lot of people try this. They eat in the sitting. They're like, oh my God, I'm gonna buy the four pound bag on subscription on our website.

44:20
Daniel Scharff
That sounds like. Yeah, I'll check that out. Okay, cool. So one thing I just wanted to ask you is just about kind of gut health in general. Do you think that people are pretty informed about it? Do you feel like it really is driving a lot of interest in these kind of products right now? Obviously we've seen a lot of that kind of stuff around prebiotic soda. There's a lot of conversations there. How are you viewing it?

44:44
Tim Richards
Yeah, totally. Well, you know, I just saw a Food Navigator article the other day from their Europe branch and they're saying that gut health market globally is going to be 270 billion by 2034. And right now it's like 116 billion. So yeah, it's going to be more than doubling in the next 10 years. And it's just an unstoppable trend that's dominating food and beverage.

45:04
Daniel Scharff
What do you think will drive that? Or what do they say? Is this just every product category getting more serious about gut health and adding the kind of products that specifically focus on that, or is it just dedicated gut health products and people getting more interested in them?

45:18
Tim Richards
Well, you know what I saw in conjunction with that was some of the most searched body wellbeing trends on social media in 2024. Number two was probiotics, number three was kombucha and number four was vitamin B12. So we're kind of. We're basically like the Kombucha snack nuts. You know, we're boosting all those B vitamins and you know, we use probiotics to achieve all these functional benefits. So we're trying to tap into these megatrends. You know, gut talk, for example, on TikTok has over a billion views on that hashtag. The gut health hashtag on TikTok. So it's like some people are buying probiotics, some people are buying kombucha and food and beverage products. It just kind of depends on the consumer really. It's like, how do you want to take your medicine? Right.

45:58
Daniel Scharff
I like that analogy a lot about the, like kombucha one, except I don't know, I could never really get on board with kombucha personally. Just the taste, I think was a little too acquired for me. But these I just loved on day one. So I think, yes, that is true, except you're. It's hard to Honestly, even hard for me to imagine who, anyone who wouldn't immediately love this. I know you said that there are some people who didn't grow up with these flavors, but it's just so universally delicious and I don't know, it's addictive. Honestly, Tim, you're going to get me addicted to this. I got 4 by 4 pound bags just delivered here, so give me your.

46:33
Tim Richards
Address and I'll send you from.

46:36
Daniel Scharff
I'm going to have the least nuttiest gut ever, but also full of nuts at the same time. So I wanted to ask you as well. Obviously we are partnered here with the Almond Board of California and you have done some great work with them. Can you just tell me a little bit about like how if partnerships or accelerators, specifically them also how have they helped your journey? I would love for people to understand what organizations like them can do for you.

46:59
Tim Richards
You know, you did that awesome collaboration bag at Expo west with the almond innovation bag and you know, that really helped us get our product out in front of a bunch of eyeballs that wouldn't have seen otherwise. So I'm really grateful to you and to them for that project. I'm also wanting to shout them because it turns out that fermentation is like an alternative to pasteurization to achieve sterilization for almonds. And it's a pretty effective way to sterilize almonds actually. So I want to work with them to kind of verify that as an alternative process. So I have reached out to them about that and I plan to do it, you know, work with them to get that verified.

47:34
Tim Richards
But yeah, anything that they have to do with innovation, you know, I haven't really talked to them one one about it, but I'm all ears. I'd love to help drive the almond ingredient forward and bring the huge trend of gut health and fermentation to almonds and just help grow it even more. I saw one of their ads the other day and they were talking all about gut health. So I think there's a lot of overlap and I'd love to collaborate more.

47:53
Daniel Scharff
It's a really cool thing. Honestly, I forgot about that until you just mentioned it. So during Expo west this year, were super excited because the Almond Board of California did tote bags that were co branded. So they were. If anyone who came by our booth probably saw them, it was a big black bag with our beautiful arrow one side and a big beautiful almond outline on the other side. And then inside of the bag were some of the most exciting almond products. Of the year. And so obviously Gut Nuts was in there and just everybody loved it. And were just handing out these awesome tote bags full of a bunch of really cool products. And then obviously everyone could then browse our section and grab a bunch more good products from all of the brands in our section.

48:33
Daniel Scharff
But that was a really cool thing for them to do for brands that are using almonds in a significant way and just really excellent ones. I mean, just everything that we heard was the brands, and they were really outstanding. And obviously specifically you. And that's so cool that they do things like that to support brands who are just, you know, trying to pave the way for these kind of ingredients. So thank you to them and to you for giving everyone delicious snacks. So, Tim, as we are wrapping up here, can you just tell everyone a little bit about how to support you? I think I ordered my sampler bag off Amazon, which I where I got one of each of your skus sent to me pretty quickly.

49:13
Daniel Scharff
Is that the best way for people to support you and get to try the product or what do you think?

49:17
Tim Richards
There's really no bad way. Obviously, we get the most margin on our website, gutnuts.com but Amazon's a great way. Thrive Market is a great way to find us nationwide, pulling us off a whole foods or a sprout shelf anywhere you'd see us in store. We also launched an Air1 Jimbos recently. And yeah, really any way you can buy us helps a lot. Also currently we're doing a we funder campaign. So this kind of innovation, it's super expensive and takes a long time, costs a lot of money. We're just starting to monetize it. So really helping us go to market with this world's first innovation through an investment as small as 100 bucks on wheat under goes a long way. Really helps us get this out there.

49:53
Daniel Scharff
Amazing. All right, well, everybody definitely go and check out the product and if you get it on Amazon, maybe leave a review. I know it'll be five stars, so go ahead and leave it. We all really appreciate it. And if you are a service provider and you want to earn Tim's heart forever, definitely leave a review. Me, as a brand, I would forever talk to anybody who actually, like, was like, hey, we're interested to talk to you. I went ahead and bought your product and I loved it and I left a review and here's what the review looks like. Of course I want to talk to that person. I don't think I've seen any service providers take that approach, but don't you think that would work?

50:26
Tim Richards
Oh, yeah. I would definitely return your email and schedule a call.

50:30
Daniel Scharff
Yes. I like that much better than the AI bot LinkedIn approach. So anybody out there maybe let's set the new standard for how to already get on our good side for sure. Okay. Tim, I just want to say thanks a lot for joining us. I was really excited to get you on the podcast just because. Because I like your product a lot and you seem like you know what you're doing and I was really interested to just learn a lot more about it and I know we're just going to be seeing a lot more of it. So thanks a lot for taking the time and I'm excited to also let you get back to the Santa Cruz Mountain Yeast air and enjoy some of the outdoors here.

51:08
Daniel Scharff
I'm in the West Village of New York, so it's not quite as fresh outside, but we still like it.

51:14
Tim Richards
All right, Daniel. Really appreciate it. You know, it really helps us to have a platform as emerging brands because it's kind of a doggy dog knife fight for survival world as a startup CPG brand. And man, you just really help give us a platform and get us out there and interconnect us and really appreciate what you do.

51:29
Daniel Scharff
Thank you, Tim. We love to do it. We really do. All right, thank you everybody. All right, everybody. Thank you so much for listening to our podcast. If you loved it, I would so appreciate it if you could leave us a review. You could do it right now. If you're an Apple podcast, you can scroll to the bottom of our Startup CPG podcast page and click on Write a review. Leave your company name in there. I will try to read it out. If you're in Spotify, you can click on about and then the star rating icon. If you are a service provider that would like to appear on the Startup CPG podcast, you can email us@partnersartupcpg.com lastly, if you found yourself grooving along to the music it is my band, you can visit our website and listen to more.

52:14
Daniel Scharff
It is superfantastics.com thank you everybody. See you next time.