How a failed Whole Foods deal built Little Spoon: Founder and CEO

My guest today took an industry that hadn't changed much in generations and found a completely different way to compete. Ben Lewis is the co-founder and CEO of Little Spoon, the children's food company that's delivered more than 80 million meals to families across America. But before Little Spoon became a major consumer brand, its original retail strategy fell apart. Instead of.Up, Ben and his co-founders built a direct to consumer business that eventually became profitable and expanded into more than 1800 Target stores. Today we're talking about rejection, entrepreneurship, raising capital, and what it takes to build a brand parent's trust with their children. I'm Ian Schwartzman, and this is Built Different.Ben, thank you for coming on Built Different. Happy to be here. Yeah, thank you. So I wanna first pick up on why babyfood.

So I was working in the food industry before this, um, fun fact, um, I started Little Spoon with my now wife. We weren't married at the time, um, both grew up in Pittsburgh together, um, both kind of found our way into, um, into the food industry, um.You would think people that would start a company like Little Spoon would be, would be parents, right? You're, you're starting a business from a place of a personal pain point. Um, for us that was not the case. We, we were, uh, working in the food industry and literally saw this shift towards fresh food. Um, it felt like everything was moving away from the Gerbers of the world, um, in other industries looking at even the pet food space where there were.You know, 1012 companies back, you know, back then, um, even selling fresh dog food and literally no fresh food for babies.

Why do you think that is?

It's a great question. I think, um, I think a couple of things. One, it's hard, um, so, um, I think

hard to make baby food. Yeah, it

was, I mean, a lot of things, right? I think like the trust is.And probably the most essential ingredient in, you know, when you're selling food for babies and kids, um, there's also a perception of it being.You know, a high regulatory, uh,

barrier, an FDA, like is this approved? Gerber had all the licenses, FDA approvals, the stamps of, uh, uh, insurance that this is a safe product and Little spoon maybe didn't at first, right?

Yeah, you're starting from scratch, right? So you have, you have to earn the trust of, of parents, um, and you have to, you know, and I mean for us, I mean our.We, we faced many challenges before we even got the, the, the business off the ground, um, you know, the first being we couldn't find anyone who wanted to make this product for us. If you're a manufacturer, would you rather make.You know, a hummus or something easy that is, you know, sort of more commonplace, or do you want to make, do you want to make baby food and take on this extra liability, at least that's how it was perceived, um, from, from a brand that at the time was, you know, entirely unknown and unproven, um, and so, yeah, so I mean it's, it's, it, it, you know, it all comes down to trust and we have worked really hard to earn.The trust of parents and,

but, but, OK, so 2017 rolls around. Your current girlfriend, who is now your wife, congratulations, uh, you two come up with little spoon and you wanna service organic real food to babies across America. What was that first step?

So I mean it started with.Actually making some of the first recipes, which, um, Angela did in our, in our kitchen in uh in our apartment in San Francisco at the time, um, you know, it's not actually that hard. You're just, you know, buying ingredients, you're, you're, you're you don't have we don't have kids.

So whatwere you, what were you thinking

it's a good

question. Well, if you don't have kids, how do you even take the first step to introduce a brand that's totally unknown.To parents and you start, you're cooking up meals based on what I

mean we were hearing from, we were hearing from parents, whether it was, you know, friends, family, just people on our networks, they, they weren't even buying shelf stable baby food, they weren't buying Gerber.Felt guilty doing so. They didn't actually trust the brand they didn't, you know, I think um we saw that there was this really profound lack of trust of the, the incumbent players in our, in our space and what we heard most often was.You know, people like us that are a little more considerate when it comes to, you know, what you, you know, understand, you know, food is health and what you are, what you eat. It felt like they had to make this trade-off of either settling for this, you know, kind of the convenient option. You don't want to feel like you're settling when it comes to your kids, your kids, right? Um, or you have to make it yourself, which is.

Laborious, laborious. It's,

it's, it's, yeah, it's, it's a pain and not everyone has the time. We saw the opening, we just saw that there was really a gap in the market. It was very glaring and obvious to us as people in the food industry and, you know, we, I guess we're the ones crazy enough to actually. That's right. When we launched the company, we started with one product line, which is we call baby blends, fresh pureed baby food. The fact that it was fresh.Was our main, so

how long did it last onthe show?

Also, so no, it was, I mean, so literally like you made it at home.

You made it at home.

No, we didn't actually make it the same, the same quality, homemade quality without preservatives, without heavy heat pasteurization. We actually saw, and you know, one of the, one of the taglines that we launched the company with was, your baby's food shouldn't be older than your baby.And literally we learned that a lot of this gross, you know, the, the, the, the baby food that you would see sitting in jars or pouches on the shelf at the grocery store was in many cases older than the baby that was eating it.

It'scrazy. Do you realize before getting into the market that parents will spend almost anything to make sure their children are healthy and safe?

I mean anecdotally we we heard that one of the words we hear from our customers most often actually when we do customer interviews is relief the parents actually feel.Relieved that they know what weight off their shoulders, they feel relieved they feel peace of mind in, you know, not only choosing us as a brand, but just how does that make you feel kind of day in and day out in your routine.

So, OK, you guys get going and then, uh, somewhere along the line, Whole Foods approaches you guys a, why, what is distribution in regards to baby food? Why is it so important and.How, how did distribution impact your strategy?

I mean, before we launched Little Spoon, 100% of baby food in America was bought in stores. Um, distribution is.You know, is a, is a necessary evil. You have to get your product, you know, into the market on shelves, um, for people to be able to discover it and buy it,

but hold on, you, you just said something interesting.First of all, I know you're in a ton of stores now, so we'll get to that, but you said you have to get your product on shelves for people to buy it, but you actually did the opposite. That's right.So what happened first of all with Whole Foods? What was supposed to happen versus what happened? Let's start there. Yeah,

so when we, when we started the brand, I mean, the original, the game plan originally was to launch the brand in retail, the traditional, the traditional way, um, maybe eventually get around to, you know, selling online, but that was.That was certainly not the focus. You want a big box, you want a big store. Yeah, and we and we wanted to start with Whole Foods because we really saw Whole Foods as being this sort of healthy organic. Yeah, we thought that it would really give a nice halo in terms of, you know, especially as a new brand trying to earn trust. So we had, we had a deal with Whole Foods. We were supposed to launch in a few of their regions across the US.And one thing led to another, long story short, and um that got kind of put on ice um at the 11th hour. I mean we had actually already produced.Physical product we had done a small production run. It was, I mean, at the time I think it was a few 1000 units, um, it felt.Enormous.

It was big. It was a big weight for you at at the company size you're at, right?

Oh yeah, I mean, it was the very first production run. We poured everything that we add into getting it off the ground. We had product actually in transit to these tothese

Whole Foods. Yeah. How many Whole Foods were you supposed to be in with that?

I thinkit was like maybe 150 something.

I mean, that's significant, but in the, in, in the scheme of national distribution, it's not the biggest, but it's huge. Yeah, it's a lot. It's a

lot and it was, it was, it was everything to us at the time. And so, um, so we were, we were just getting ready to launch and, um, I, I had this kind of happenstance run-in with somebody from the, the, the global team at Whole Foods.Who we were telling about the launch, and he was actually, he was super excited, loved what we were doing, but, um, you know, rightfully said to us, hey, have you guys gone through our quality and food safety review process, fresh baby food? Never heard of this before. It's a whole new thing, a whole new category we need to, but

how did he get there ahead of, like, how do you have a deal in place ahead of them even doing a QA check on your.

You know, I think it was just this classic case of like big company bureaucracy and a lot of, you know, maybe did he bring your deal on? No, no, so we had, we had worked with the regionals, uh, the regional buyers directly at the time. Whole Foods used to do the buying at the regional level, so we had a, we had, we had a few regions that we had struck individual deals with and then, um, you know, sort of like 11th hour curveball.I think it was a genuine, I, I think that I mean, genuinely, we were doing something that the market had never seen before. They had never seen it before. Quite frankly, it might have been irresponsible for them to launch our product if they didn't go through FDA the quality and food safety review process, um, which was their own internal process. So yeah, it was, it was an extremely unfortunate situation.Everything kind of came to a screeching halt and we had to, we had to figure out like where do we go from here? Do we want to wait around for Whole Foods, which we did for a while. We waited for, I don't know, probably 6 months.

You sat there and immobile for

6 months. No, no, no, we were, well, in, in parallel, we said, well, OK, while we wait, why don't we, why don't we stand up an e-commerce store? And this was back in, I mean, so we launched as a company, this is 2017.And I mean this was, you know, a time period where e-commerce wasn't even what it was now, of course, but, um, but, you know, selling, selling food online, perishable food no less, was.You know, it was unheard of. It was pretty unheard of. First I'll say it, what, what felt like an incredible, perhaps insurmountable challenge at the time ended up being a total blessing in disguise and, and the very best thing that could have ever happened to us. I don't even know. I think if we would have launched at Whole Foods, I'm not sure the company would have even made it. I don't know that we would still be here today. I mean, certainly we wouldn't that weird, the company that we, that we ended up being, it's super weird, um.The, I mean, we, yeah, having that direct relationship with your customer, really controlling your own destiny too, and being able to, you know, control every single variable of the experience, that I believe was critical in not only our ability to scale the business, but our ability to forge this very deep connection with a customer that allows us to earn their trust in a way more powerful way than you can when you're, you know, just a product.On a shelf, a sea of a million other products.

At what point do you say we need to raise capital?

So we raised capital relatively early, you know, in the journey. I mean, it was, it was, I mean, it was actually much, if you don't mind detailing in the, in the beginning, it was, it was like.Maybe a million dollars. The hardest part is getting the first money in, right? So, um, it was getting, you know, one person initially who was interested in investing. These were not, by the way, institutional investors, these were just family people. They weren't even family friends actually. They were, they were just like.Like one guy I met in the, um, in the food industry. I met him at a trade show. He had, you know, invested personally out of his own pocket in, in a handful of other companies. He really liked what we were doing. He said, I'll put money in if, if, if, you know, my buddy, so and so puts money in, he introduced me to his friend, we talked to him. One thing, yeah, then, and then that led to something else and it was sort of all of a sudden you have this kind of critical mass of people.You know, writing all of a sudden you get, you know, there's excitement, right? And then there's FOMO and they're telling their friends and so, um, so really, I mean it was, um, I, you know, definitely getting that, getting that first, um, that, that very first yes was, was by far the hardest. A lot of no's to get to the one yes, but then once you get the one yes, you get a few more yeses, um, it leads you down a positive path, it leads you down a positive path. OK, this

is important.When you gain capital, you lose

control.Is that what you were gonna say?

I'm asking, um,

yeah, I mean, look, I think you.I think that can be true in many cases. That was not true for us, but, but you, but you know, you're taking on, you have all of a sudden now, not only, you have other people, um, and these aren't, you know, these are people with.You know, these are, these are not, you know, faceless institutions. These are people, these are individuals, individuals like

really putting their money in

totally and believing, believing in you, believing inus.

What kind of pressure does that create for you and your partner? What kind of pressure did it create both in your personal relationship and your professional relationship with your partner?

It had hada, it had a massive impact. I think it's hard to trace back exactly how every single, of course, you know, micro detail.The impact it had, but, um, but I mean, yeah, we, we, we felt an enormous responsibility to make this business successful, to, you know, and actually I had a previous business that was unsuccessful, and that taught me, that taught me a lot, and that, you know, going into this the second time around, I think there was a sort of heightened level.Of anxiety and pressure to ensure that this was going to be successful. And of course, we had no idea whether it was going to be.

You can'tread a crystal ball.

You cannot read a crystal ball. We've tried, um, but, um, you know, we, yeah, I mean, you feel like you kind of have the weight of the world on your shoulders. And to your question of like building a business with your partner, I think when it works well, it works really, really well. It's truly uh, it's like truly like an incredible privilege. I feel that we get to wake up every day.Like not only build a great business.But to be able to like have fun doing it, you know, again, you have to be all in when you're building a business for, for you to be successful, may as well be all in together, you know, I, I think about sometimes like if, if, if Angela and I, let's say in a different universe, you know, I had started Little Spoon and she, she did something different or vice versa, like I don't know that we could have been as supportive of partners to each other.

Meaning if you were working on separate things atthe same,

how do you have the empathy? How do you know what the other, like now like we know what each other are going through, we can relate. There's, there's so much shared experience, experience and lived experience together. I think it makes, I think when it works really well, I think it's just like a kind of a powerful thing, um, of course, you know,

are therestressors too? We, I don't wanna paint that it's all upside. The

pressure is real for sure. I mean, and you know, I think we feel an enormous amount.Of pressure to like do right by our team, do right by our investors, and then of course, you know, for ourselves and, um, I, you know, I think the downside.To this is that like it's the same flip side of the same coin you're all in,

but are there ever times where you're like, I need to turn it off? Yes,

I think we, I think you have to find, you have to find those, those moments of like being able to dip out at times when like you just need time to kind of like be a human being, be a human being and just like be present and like whatever the moment that you're in. But the nice thing is we, we love what we're doing. We love the business we're doing, we're having fun doing it, so, um, so it, it doesn't feel like work, which is I think the best part about it

definitely.So you guys get into you right now, Little Spoon is in over 1800 targets.

Yeah, we started with Target last year. It was actually the largest food and beverage launch in Target's history. Congratulations. That's huge. Thank you. It was a pretty, pretty crazy even to say those words, um, but like really just an amazing opportunity for us as a brand. I mean, they, they really leaned in. We launched, um.Across 6 different product categories, almost 2 dozen products, 23 products in, in 1800 doors like you said, uh, national launch.

What's your, what's your most.Popular and profitable single food or product on Little spoon for the longest period of time.

Oh.

Um, there's one skew that has to be outperforming everything.

So, um, in retail, I would say at Target specifically so far, um, we have, um, I mean, we have a baby puff item that that's actually the number one selling item in the entire baby aisle out of 500 505 products are puff skew. It's the number one selling item in the entire, in the entire category.We have products in like in the freezer section, totally separate part of the store, selling to much older kids, things like our spoon shaped chicken nugget or chicken dippers or mini meatballs. These are like top decile velocity items at Target, um, not just among kids' products, but in general in the whole freezer. And so, um, so we have some pretty high performers. We started the company with.Our baby food, the purees, um, we have grown the business really by growing with our customers, going from baby to toddler, toddler to big kid. We actually just earlier this year launched infant formula, so even pulling forward earlier in the journey.Um, starting from day one, right, infant formula is a sole source of nutrition, really big deal, very challenging

category. What's the regulatory stuff on, on infant formula? It has to be a whole, it's all, it's caboodle,

yeah, I mean it, it's, it's a whole other level. I mean, infant formula is regulated more like a drug than a food, and so it's, you know, pretty different than pretty much any other category that you would, you know.Play in as a as a food company, but for us it was the ultimate opportunity to get our foot in the door early. I mean, one of the things we we sort of like hypothesized in the beginning is, if somebody's gonna trust Little spoon to be their baby's first bites of food, then sure enough, they'll want to trust us from, you know, these,

I think itcan go all the way into adulthood. I don't know how to feed myself. No seriously,

so I'm figuring it out too. Yeah, look, I think, I mean,The, the market opportunity is, is,

is, what is the market opportunity? Like, forget about baby food. I wanna know if you have, uh, all your ducks in a row and you could take these customers that you have from 1 year old to 50, what is the market opportunity of Little spoon?

I'd have to do the math.

You've done the math, and you're an entrepreneur. You've done the math.

Look, it's a map.

Say the number. I

don't know that we, we have our addressable market just in the baby and kids space from 0 to 10 is.A multi $100 billion opportunity, right? Like we're talking, I mean, when you think about, I mean, our, our view, we think we have a right to win when it comes to all food and nutrition decisions.For, for, for babies and kids.That's already a massive opportunity and we're just scratching the surface of that. Certainly there's plenty of other opportunities beyond that. Big spoon could, you know, never say never, never say never.

I said it here beforethey do it.

So we believe we're building a generational brand. Little Spoon is not a baby food company. We are a partner to the parent when it comes to all things food and nutrition for their kids. You can see that has already played out in terms of the breadth of our product offering.You know, the breadth of our product offering interestingly allows us to forge a much deeper relationship with our customers, one that's also more lucrative. We're able to, we're providing them more value and then getting more value back. So we're building a generational brand. I'm not a, I'm not the type of person that is going to kind of like pre-prescribe what the outcome is. That's not our focus. Our focus is like we're building a great company. I think if you build, I think if you build a great business.You have optionality. Optionality means you could do any number of things and so that's, that's sort of the, that's the mindset that we're in. It's just let's stay heads down and, and keep creating value, doing right by our customers, and, you know, creating value for the business. I mean, like good options follow and we'll figure it out.

I love that. As long as you're running the business, would you ever let go of your ability to go direct to consumer?

No.We, it is.So core to what Little Spoon is and what has made this business so special, we're only 1 year into our launch in retail, and there's no doubt in my mind that at some point in the relatively not too distant future, retail will be bigger than D2C, and we have quite a large direct

consumer. You're betting that retail will be bigger than retailagain,

yeah, I mean, why? Because.You know, 90% of food in America is bought in stores. It's just a function of like the market dynamic. The, the, the, the fact is, the volume and the consumption is happening in retail stores.

You don't think therobots could deliver us the food and we don't have to go shopping anymore?

I'm here for that. We're, you know, we're, and I've, I've never, I've never been more bullish on our direct consumer business, just to be clear, I mean, the, the, the opportunity now toUm, first of all, we're just getting better and better as we go. We're learning, we're iterating, and

you're taking the data and you're refining, so you know

what you're doing and, and, and, and every single, every single day, it feels like we're, yeah, we're just, there's another breakthrough, we're getting better. We're able to serve the customers better.Um, you know, I, I, not to talk about AI, but think about all the amazing opportunities to be able to, it's gonna be amazing, hyper personalize the experience. Um, I, I mean, I'm, I'm very bullish on, on D2C. By the way, I think D2C is also, I think the, the.The strength of the D2C business, um, has allowed us to be so successful in retail. I don't think we would have had the, the opportunity to have Target's largest food and beverage launch and, you know, to be able to really without D2C, right? Without D2C because it's, it's allowed us to one.You know, it's, it's the product assortment that we've, that we've built for D2C that really only works through a D2C model that we, it's the, it's the marketing engine of D2C that creates proof

of concept, right? You walk in any room, you go, look, without you or with you, I've already done this.So whether Target picks it up, Whole Foods picks it up, you're chasing a category where trust is paramount, OK? And you went and built a relationship directly with the people that have to buy the product for the kids. The babies can't take out their wallet and buy a little spoon. The parents did.And so I really appreciate what you did, but before you leave, I have a question. Were you ever into, uh, card collecting?

Personally, no. I mean,

no problem.

I, I, there was a, there was a, there was a brief, a brief, uh, you

didn't collect a Pokemon

or. I was gonna say a brief Pokemon phase back in the day, but that's, it's a distant

memory. Ben, one of the businesses I have since I am a big card collector is called Centerca Cards. And so for every guest that I have on the show.Uh, I have center cut make a very limited one of two card, and I wanted to give it to you, and, uh, here it is. This is Little spoon. Now you have your own collectible card and it looks at my

like, look at my hair in here.

That's right. It's filled with vegetables and fruits and cauliflower, apples, very, very cool. Um, yeah, it's, it's one of two, and the only thing I'm gonna ask you is that you sign mine so that I have the only.Uh, player collectible card with Ben Lewis's signature, uh, stocked away so that one day when I auction it off, it's either you or someone in your family that's trying to buy it.

Amazing. Wow.

And thank youfor coming on,

super special. Appreciate it.

Yeah, co-founder and CEO of Little Spoon, thank you for joining us and thank you for being on Bill. Of course, thank

you for having me and thanks for being a Littlespoon customer.

Thank you.