Industry experts ranging from long-time entrepreneurs to grocery buyers and beverage investors shared their optimism about the road ahead for emerging brands, while also emphasizing the importance of a strong focus on business fundamentals and managing growth within the bandwidth of your balance sheet today. Those themes manifested in main stage discussions throughout the first day of BevNET Live Summer 2023 with topics ranging from online channel strategy to managing changes within established brands.
After 77 years, Milo’s Makes Big Moves
Trisha Wallwork, chair and CEO of family-owned Milo’s, never thought she’d be leading her family’s business, but in 2011, the former corporate lawyer and vegetarian took the helm at Milo’s – an operation that included a chain of hamburger restaurants and a now lucrative CPG line of sweet tea.
On stage this morning, Wallwork spoke about the complexities of navigating growth and change within a 77-year-old, family-run business. She explained that creating economic prosperity for her family, and the families of Milo’s nearly 700 associates, has remained the company’s north star since her grandfather opened the first restaurant in 1946.
“We’ve created and built governance around our business [since]… that has allowed us to avoid the potholes,” said Wallwork. “We have an independent board of directors, we keep the family business out of the boardroom and really spend a lot of time getting to know who we are, what are we going to focus on? Thankfully, the whole family is so focused on growth [and] we think there’s so much opportunity for authentic brands like Milo’s.”
In 2021, the Birmingham-based beverage business reached a new level of sweetness – earning the ranks of number one refrigerated tea brand and the fastest growing lemonade brand in the U.S.. Wallwork said the key to that success was simply keeping focus on core business fundamentals. When the brand was on the cusp of growth, she weighed every decision against the business’ own needs rather than with market pressures and a growth-only mindset.
“You’ve got to run a great business,” she stated. “We have done that by [being] really obsessed with customer service… making sure [we] deliver on time and in full, being honest with [our] customer about what we can do and can’t do.”
“It is also having those brutal conversations and being willing to say no, that is not what’s right for your category, that’s not what’s right for our business, and it’s not what’s right for [our] shopper,” she continued. “When you do this, you unlock that honest relationship with your customers that, for us, has allowed us to be the category driver.”
Wallwork also credits that inward-looking nature and business success to its strategy employees. She highlighted that all Milo’s associates have roadmaps for growth within the organization, however, as the business has managed explosive growth that has also meant making difficult personnel decisions and shifting roles for individuals best suited to keep pace. She said the company aims to keep communication transparent across the entire business structure and that has allowed it to make those difficult decisions while retaining employees, and their trust.
Your Financing Future Hinges On The Fundamentals
Despite the headlines signaling an economic era of doom and gloom, not all investors are equally as pessimistic. Elliot Begoun, founder of TIG Brands, Michael Burgmaier, managing director of Whipstitch Capital and Erin Wall, partner and CRO at Lunr shared their impressions of the market, and what brands should be prioritizing on stage this morning and the outlook hinges on each entrepreneur’s ability to plan for profitability as soon as possible.
According to Burgmaier, though deal flow is down 50% compared to this time last year, over the past six weeks it has “improved dramatically.” He said the fears of an economic downturn, coupled with bank failures and rate hikes, hindered deal flow in the first half of the year, but has since brought the market back to “a sense of calm.”
“I find myself, at this moment, both terrified and optimistic,” added Begoun. “I’m terrified that the change that needs to happen isn’t going to happen fast enough for some of the brands who are on the edge and I’m optimistic that the things that we’re talking about now as an industry are things that we should have been talking about earlier – putting profit before growth and cash before everything and trying to think about better alignment between founders and funders…. [Brands] also have to be realistic about who they are right now. Are they a rocket ship? Or are they a Camry?”
However, all three panelists agreed that those lingering questions about the market don’t matter if the entrepreneur is not focused on building a good business with a path to profitability and plan to reduce cash burn. They agreed that while raising capital is tough right now, for early stage companies there are a lot of other methods to notch some wins like looking outside the banking sector to fintech or being aggressive within your operations to streamline and cut costs that could set you ahead down the line.
“For entrepreneurs, thinking of how you cannot dilute yourself over time is still incredibly important and a good strategy so that when you are ready to exit, you own the most of that company,” said Wall.
Additional Day One Highlights:
- According to Nutrabolt CRO Kyle Thomas, energy drink C4’s transition into the Keurig Dr Pepper (KDP) system has been the “fastest, most comprehensive” transition he has ever taken part in. The key – having the right people in the right place at the right time – he said.
- The Sprouts buyer team detailed their role in the growth of emerging brands and the goals for the retailer’s new Innovation Center program which gives it an opportunity to be first to market for some businesses, while keeping their assortment fresh and on trend.
- Vita Coco co-founder and chairman, Mike Kirban spoke about the benefit of creating a “fail and forget it” culture as the brand has innovated and grown. He said that although when category competition began to heat up he spent a few hours in the bathtub with “a bottle of whiskey and a cigar,” those outside forces inspired his team to stay sharp and keep innovating in areas that would later set them ahead.
- Super Coffee’s co-founders shared how they’ve shifted focus following the appointment of new CEO, Tyler Ricks, noting that while the fraternal trio always delivered on execution, Ricks brings a strategic eye, particularly to reign in cash burn. This year the brand is planning for flat growth to reset on business fundamentals and in the end, believe they will be “making more money than we’ve ever made before.”
- Online sales expert Nik Sharma shared his method for converting direct-to-consumer sales to insight for brand building and what role he believes digital channels should play in an omnichannel strategy.