Advice Line with Pete Maldonado and Rashid Ali of Chomps

Hello, and welcome to the advice line on how I built this lab. I'm Guy Raz. This is the place where we help try to solve your business challenges. Each week, I'm joined by a legendary founder, a former guest on the show, who will help me try to help you. And if you're building something and you need advice, give us a call and you just might be the next guest on the show. Our number is 1-800-433-1298. Send us a one-minute message that tells us about your business and the issues or questions that you'd like help with. And you can also send us a voice memo at hibt at id.wondery.com. And make sure to tell us how to reach you. And also, don't forget to sign up for my newsletter. It's full of insights and ideas from some of the world's greatest entrepreneurs. You can sign up for free at gyros.com or on Substack. And we'll put all of this info in the podcast description. All right, let's get to it. This week, I'm joined by Pete Maldonado and Rashid Ali, co-founders of the grass-fed meat stick brand Chomps. Pete, Rashid, great to have you guys back on the show. Thank you for having us. Yeah, thanks for having us. You were first on the show in 2023. And as always, to anyone listening, if you haven't heard that story, we'll put a link to it in the episode description. It's an awesome story that eventually led to this amazing brand, Chomps. Pete, you actually came back onto the show for advice line, so it's not your first time here. Rashid, welcome to the advice line. Thanks for coming on. Yeah, thank you. Before we get to our callers, I want to ask you guys a couple of questions. We're in a protein world today. It seems like people are putting protein in water and yogurt, ice cream. I've seen protein everywhere. You guys have been in the protein business for a long time. And every trend I'm reading, every sort of forecast is saying the protein market is just going to expand and boom and grows. So tell me a little bit about, you guys are both leaders in this category, but also riding a wave too. Guy, I think we're on the right side of a big trend. But like you said, we've been at this for a while. And we think at some point with any trend, there will be consumer fatigue. Sometimes internally we talk about the proteinification of everything. You mentioned water and ice cream and popcorn. And so chocolate, exactly. And so chomps is winning on the current momentum behind protein, but we're going to win on the other side would folks get a little bit fatigued on it. But at the end of the day, I mean, there's a lot of room for additional protein in folks diets, especially convenient, natural sources, and chomps is that that solve for our consumers. You know, listen, this is this is a cultural shift. There's not a fad. People are changing the way they're dieting and eating and they're educating themselves and that's not going away. Right. And so we always knew, you know, protein was, was, uh, people needed more protein than their diets when we started as 13 years ago. That's why we're here. Uh, but we never anticipated, you know, GLP ones and, you know, doctors all over the place telling their, their patients, you need to eat more protein and it's, it's more protein per calorie. Right. And, uh, this is, you know, it's a wave for us for sure. Yeah. I want to talk to you guys about last year because you faced a challenge last year. And I'll just kind of give some background, which is nobody found it, but there was a possibility that one batch was contaminated with a bit of metal. And this is something that is not common, but it can happen in a manufacturing process. There's metal equipment. There's all kinds of metal that food goes through. And, you know, very rarely a tiny piece of metal could chip off from a grinder or something and end up in a product. you guys found out about it nobody saw metal in their chomps but but it was a possibility and you had to recall just tons and tons of products which i imagine was a really it was a low point for you guys last year can you talk a little bit about just how that you know like just how you kind of handle that it was one of the hardest um times in the business really just figuring out how to react. And I'll say it was an isolated incident, exactly to what you said. We did an internal investigation and identified one of our seven facilities on one packaging line at an evening shift on a Friday where something seemed off. So to avoid any risk, we expanded the scope quite significantly and did a pretty large scale recall. It was painful. It felt like the world was ending, even though it was so isolated. I mean, at the end of the day, Chomps is mine and Pete's baby. We started this from nothing. And it's here because of our consumers. So you think about like the potential risk of chomps putting any of our consumers at risk, we were not gonna do that. So we went through the process and in the end, we didn't find any metal, right? There was no adverse reactions. Thankfully, no one got hurt. We got through it and it was tough. Like I always say, what I tell the team, one recall is one too many, right? It's just, it's not acceptable. We can be better. We have to have processes. You have to have controls in place. But now I can say with complete confidence that we have handled it, we've got through it. And I think like the organization infrastructure is far stronger because we did say like, we can get tighter here, here and here. And now we have new processes to make sure that it won't happen again. Yeah, I mean, the way, you know, it reminds me of Jenny's Splendid Ice Cream. She had a recall early on in that brand and the way she handled it was so same way, you know, instantly there was, nothing was confirmed, But it was like simply because of the possibility they recalled their ice cream. It cost them millions of dollars. And consumers really appreciated that preemption and that sort of overcorrection. And at the end of the day, not only did it not hurt the business, but the business just grew exponentially. And I imagine you had a similar reaction from your customers. But I imagine it cost you a lot of money. A painful amount of money. It did? Yeah. And it's still TBD as far as the ultimate exposure. Just at the end of the day, when we were going through it, the cost or expense never crossed our mind, right? The goal was to remove any consumer risk, any product risk, and make sure we make the right decision, long-term decision. So like, yes, it was a material cost. We're still kind of weeding through the total impact, but no regret. Yeah. Sounds like you guys handled that really, really well. All right. What do you guys say? Let's bring in our first caller. Shall we do it? Absolutely. Let's go. All right. Let's go. Let's bring our first caller. Welcome to the advice line. You are on with the co-founders of Chomps. Tell us your name, where you're calling from, and just a little bit about your business, please. Hi, Guy, Pete, and Rashid. I really appreciate you having me here today. My name is Yadi Darius. I am the co-founder of Yaddy's Artisanal Empanada here in New Paltz, New York. Awesome. Welcome to the show, Yaddy. And Yaddy's Empanada, so I'm assuming you make empanadas. Do you sell them in stores and grocery stores? Tell me about the business. Sure. So Yaddy's Empanada's really started, I was a formal teacher for 23 years or so. But food has always been a passion. So I come from a Latin culture. Empanadas is just something that I grew up eating as a childhood favorite. And as it became something trendy, and I realized that culturally it was catching on, I honestly couldn't find an authentic empanada anywhere. And everywhere we try empanadas, they were either greasy, not freshly made. They didn't have enough filling. I felt like empanada was really quickly becoming like a quick fast food. Yeah. And so I really wanted to elevate a street food into something that you feel good about eating that's made with fresh ingredients where we're not compromising the quality and the flavor. And so that's really where it all started. I love it. So you were a teacher. And when did you start this business? Did you left your teaching career to start this business? I sure did. So I thought for 23 years. and in 2021, decided that I will resign and I would start the business right from my kitchen. And so for about a year, we focused on just selling to coworkers and friends and schools. And then from there, we landed in a commercial kitchen. Did that for a little bit. We ended up starting farmer's market, pop-ups, events. We then bought a food truck in 2023. Wow. And from the food truck, we landed at SUNY Nopal. So the opportunity came. At the university there? At the university there. So you opened a brick and mortar space or a physical space on the campus there? So I think that's, so while it is a space that we have, we started our first location was August of 2024. We opened at the far end of campus inside a small convenience store. So previous to that, we were making the production from the commercial kitchen. But when the opportunity came in to go on campus, it wasn't approved for us to be producing from the share space. And so the compromise was for us to produce right from their campus, but at a hefty fee. Got it. Okay. So you now, you have a, you sell most of your empanadas on the SUNY New Paltz campus now? I do. And tell me a little bit about your sales. How did you do last year? So the first year we did, from day one, our sales were really good. We were averaging about 1,500 a day on daily sales right from day one. By the end of that semester, they had moved us into a bigger location, centrally located on campus, because we were doing so well. And within a week there, we had double our sales. So our sales are currently and have been now for a whole year on average of $3,000 daily. That does go up some days to $3,500 on really good days. But average, we're making $3,000 a day. So $3,000 a day, I mean, that's pretty great. I mean, you're maybe doing $700,000 or more a year in sales. Correct. Wow, amazing. Okay, so before we dive in further, what is your question for us? We're wondering at what point do we think about a second location, brick and mortar, since right now, technically, while I have this location, it's not really ours. Do I move into other colleges and really duplicate what we have into other schools? Do I go back to distribution? So is that that sort of like road? What do we do? All right. So sales are strong at this location on the SUNY New Paltz campus. you're wondering whether you should open a second location or focus on distribution or combination. But Pete, Rashida, I want to bring you guys in. Thoughts or questions for Yadi? Yeah, Yadi, nice to meet you. This is Pete. Yeah, you're speaking my language here. I grew up eating a ton of empanadas. I'm Colombian and my grandmother used to make them all the time. My mom makes them now. It's the only thing I ask for for my birthday, which is coming up at the end of this month. So I'm very excited to get my batch of empanadas. um but um okay so my first question is about you know labor and management at this this first location that you have are you is this thing running itself like while you're here talking to us is there somebody there selling epinadas so it really is now so when it started it was really my husband and i and my children so it was really family working around the clock 18 20 hours a day my husband will leave his job go there now we have a team of nine people and i have a manager that being trained now Family also is really trying to keep it family as much as we can And so no, I don't have to be there now for Yadis Empanadas to run. That's great. Yeah. So it sounds like from like a product standpoint, you know exactly how to replicate this in terms of equipment and all those things, recipe, it's, you know, it's all pretty much, you know, you can just do this over and over again. I think, you know, for me, it would be like, you know, management and labor pool would be the biggest question marks. And then it would be like, you know, real estate, I would say real estate. That's the other question is like, do you have a, do you have a unique situation in the current environment where as you start thinking about secondary locations or scaling, are you going to occur an additional cost? So like, are you current, like, are you currently profitable in the, in the existing, like at the 700 K, like you're, you are profitable. We are. I've worked with a consultant to help us figure out where our costs should be in terms of food costs, employee costs, payroll. I think the only concern, well, one of the concerns is that with a college campus, while we do really well those months that we're open, it is closed during the summer. It is closed for a whole month for the winter. So we have all these breaks. And what I found last summer is that while we made great money and there were still profit, I now have a period of four months where I'm not making any money. So that's where we are right now. Yeah, the seasonality aspect of working with colleges, that makes a lot of sense. But then you mentioned before the food truck idea. I think that's the solve. I mean, if you have a food truck and you can have a campus that allows you to have space somewhere on campus, you can hit that target market. And then as soon as school's out, you go move that truck somewhere else where it's going to be, you know, get some foot traffic. Yeah, I guess you answered the first question that Pete had, which is, it sounds like this location can run without you on site, right? This existing location. And so is there a person on your team who could potentially run a second location if you opened it tomorrow? Yes. Great. And I think that the other questions, and it speaks to this idea of real estate, right? You are in New Paltz, New York. I guess are between New York City and Albany, right? And New York City is a top, I mean, that's challenging. But I think, you know, based on what we know from franchise businesses that have been on the show, their expansion strategy usually begins with one location within 45 miles. So within an hour or so drive. So you can handle that second location to kind of test market it. We've actually looked into Connecticut. We're really beginning to do our research and investigate Connecticut. We like Connecticut because from New Pools to Connecticut, we're less than an hour away. New Haven's got students, right. It's got plenty of colleges. And so I think it's really, really trying to figure out, do we just continue this path of colleges since it's a niche and seem to be working? And, or do I just think about opening some sort of a kitchen, my own sort of commercial kitchen with maybe a little bit of a front store where I can maybe combine both? I like that latter idea. But if you pair it with, think about delivery. Like it seems like such a portable great item. If you think of like DoorDash or Uber Eats, that option out of a kitchen, like so true, so scalable. And then maybe you have a second arm where you have somebody that's focused on maybe within a 20 mile radius, bookstores or coffee shops, like your morning dropping off the empanadas during that. Like there's other opportunities where you can kind of be creative about how to scale and get as many empanadas in people's mouths as possible. Yeah, that's a commissary model. It's very similar to like what the bagel industry up in New York area. It's the same exact thing. So they'll make a ton of bagels and deliver them, you know, daily or whatever to all the bagel stores all over the place. You could do exactly that. And whether you're serving your own food trucks or various locations that are like Guy said, it's got to be close enough to where it makes sense. Absolutely. And I think that sort of solidify that idea that distribution is where it is, the cost of renting, the cost of the overhead of expenses, of training, of employee. While I enjoy it and really is so gratifying to see the students come in and people enjoying a meal, it is a lot. Whereas when we started and we were doing distribution, you make empanadas. I really didn't have to work so hard at getting people to get them. But, you know, empanadas, it's not like there's an empanada shop on every corner, Like there's a burger joint every corner, right? But it's got the potential to be something really interesting, especially if you're finding success in a college town. And so it does make sense to me that you're looking at a place like New Haven where you've got a lot of students. It's not that expensive. And you can generate a lot of buzz around it like, oh, hey, I heard, you know, Yachty's Empanadas are coming to New Haven. You know, especially if you work with like a local alternative weeklies or the Yale newspaper, whatever local websites or food writers are out there and you kind of build buzz, it could be a really interesting place to be. I think you're very right. And I see that in our future. As always, you know, there is that feeling of are we ready? Are we not? but having this conversation today with all three of you really does give me that confidence and the trust and belief that if it's now or never, just what can I have nothing to lose? I quit my job four years ago and I'm here. So moving forward now and taking that next leap of faith and going to the next level, I got nothing else to lose. All right. Rashid, final thoughts? Any final thoughts, Riyadi? I'm hungry. Like, I don't know why we did this so late in the day. I'm so hungry. I want an empanada now. I'm going to make sure somehow, some way you guys get some amazing empanadas. I want them right now. Once you try them, you'll know what I'm talking about. I believe you. Yadis Reese, founder of Yadis Empanadas. Thanks for calling in. Good luck. Keep us posted. Thank you so much for having me today. Thank you. We're going to take a quick break. But when we come back, another caller, another question, and another round of advice. I'm Guy Raz. Stick around. You're listening to The Advice Line on How I Built This Lab. welcome back to the advice line on how i built this lab i'm guy roz my guests today are chomps co-founders p maldonado and rashid ali uh pete rashid you guys ready for the next call let's do it all right let's bring in our next caller welcome the advice line tell us your name where you're calling from and a little bit about your business. Hi there. I'm Zachary. I'm a co-founder of Noble Pies. Our bakery is located in the Hudson Valley. We make both sweet and savory pies with real ingredients and an all butter crust. In 2025, we officially launched our wholesale line and we have three retail stores outside of New York City and are launching our first New York City store in 2026. Awesome. Thanks for calling in. So Noble Pies, sweet and savory pies are based out of the Hudson Valley. How long have you been the pie business? Yeah, our business started in 2008 unexpectedly when the financial crisis hit. My family owned a horse business and overnight we pretty much lost our business. Horses are a high commodity item and luxury. So my mother went back to her roots and she resurfaced some old recipes for my great-grandmother. And she dropped off me, my brother and my sister at the local orchard to pick a bunch of fruit. We brought the fruit back home. We baked about 50 pies and we set up a little picnic table on the side of the road of our farm. And literally within an hour, we sold out of pies and it turned into an every weekend business. And now we're here. Wow. So tell me a little bit about the business. Where do you primarily sell your pies today? Most of our business is out of our retail stores and farmers markets. And our main wholesale account is Fresh Direct. Fresh Direct. Okay. And how, and tell me a little bit about your sales. What do you guys expect to do or what'd you do last year? Yeah. So between our three stores in 2025, we did about $2.2 million in sales. Wow. And our first year of wholesale with Fresh Direct, we did about $200,000. And these are frozen pies or fresh pies you're selling? So these are fresh frozen pies, single serving, sweet and savory. Got it. Okay. Before we bring our Chomsko founders in, tell me what question you have for us, Zachary. so uh since we just launched our wholesale line we feel like we're ready for larger retailers like whole foods and target i've applied to their regional supplier programs um and did not have any luck in the in the past few years so i'm looking for new tools strategies and approaches that work in today's market to break through yeah all right makes sense uh awesome i want to bring Rashid and Pete in, guys. So Noble Pie's been doing, they've been doing this for a while. They've got a clear track record. What do you think? Any thoughts, questions for Zachary? Yeah. Hey, Zachary. This is Pete. Great to meet you. Yeah. Great job, by the way. This is, you said 2.2 million. I couldn't believe it. I was like, okay, that's great. In terms of scaling from here, what's your capacity and how much could, how many pies could you make in a day or a week or however, however you're looking at it? That's a great question. So we can put out about 10,000 pies per week in the facility that we're in now. And within six months, we can triple that with some modifications of our bakery and a little bit of expansion. And then in terms of distribution, you're shipping these or are you hand delivering these to the stores or how's that working? yep so right now we're self-distributing uh so that we can stay as lean as possible it allows us to reinvest as much as we can into our into our business so that when it's time to pull the trigger with that bigger account we can be ready uh shelf life how long do these even i get they're frozen but i'm just curious from a shelf life perspective because obviously when you layer in distribution and you're adding days. It's about four months. Zachary, a question for you, because frozen pizzas have been, I mean, that's been completely, you know, redone, right? There's all kinds of interesting frozen pizzas, but frozen pie hasn't been upgraded in the same way. So what is the argument you make that these pies are better than what might be available right now from like the, I don't know, Sara Lee or whoever's in the Safeway or even the Whole Foods freezer section? So at Noble Pies, we're so true to what is actually inner pies. Our pies are made with an all-butter crust. Our filling is made from scratch in smaller batches, but it can be made in larger batches. And we advertise how few ingredients are in our pies. When you go to the grocery store now, those product labels are pretty populated with the ingredients. So that's our marketing and branding point. And also the fact that we actually try to source as much as we can from New York State. So we also brand, you're getting a taste of New York and the Hudson Valley, because we have tons of farms here. It's a beautiful place. So you're making the argument to a buyer that you are the upgrade from whatever's out there right now. That it's unlike pizza, which has a bunch of options, there aren't that many options in pies. You're that upgrade. But I think, and Pete and Rasheed, you guys can speak to this, which is the reality of buyers for these big chains, whether it Whole Foods or Target or whatever is they don always discover brands It not always their job Their job is actually to manage risk right And to focus on velocity You're basically, you want to show that by bringing this product on, they are de-risked in a sense. Is that a fair argument, Rashid and Pete? Oh, it's absolutely. You also want to be able to have a good sell story. And I think one of the stories that Rashid and I were able to get with Chomps, it was from the data that we had was incrementality, meaning we're bringing new customers to the set. You need to be able to find a way to tell that story to the buyer because they need to know that you're not just going to be cannibalizing. If he's going to take somebody else out, another brand out and put you in and sales stay flat, what's the point, right? So he's got to figure out, okay, I'm going to put them in and they're going to bring new customers to this set that were never shopping here before and grow the category. So like, that's the name of the game. Yeah, and I'd add, because you have a four-month shelf life, I assume that's somewhat low. I don't know Frozen that well, but I would assume four months is probably a little bit on the lower side. So you have to prove that you have strong velocities, that the product will turn, and you further have to prove your repeat rate, that not only are you going to get that first customer in, that they will come back and buy it again. Okay. Zachary, you have that data. You're going to have six to 12 months of that velocity data. You could focus on one skew. You don't need to show the data for all the products because at the end of the day, it's the store manager who's going to be your biggest advocate. Like if you can get a store manager to be your advocate with Whole Foods, that's going to have more weight than you kind of cold calling them, right? I've always wondered if that still works in this day and age of Whole Foods. And I'm so glad that you're answering that question for me because I haven't walked in and talked to a store manager just yet. So I'm definitely going to try doing that. I think those are the people you want on your side. And to answer your initial question, I think it's going to sound odd, but getting into the retailer is honestly the easiest part of the process. It's staying and performing. So you've been at this for a while. it seems like your product is differentiated there's something there and it'll succeed in retail but you're going to succeed if you can have some focus like pick not just whole foods but you should do the northeast region or just a pocket of stores and keep it really focused and build the story and grow over time because the problem is right now you're self-distributing once you introduce distribution into your business it's a level of complexity and cost that you don't fully understand and then you introduce trade requirements which you currently don't have and and it's it's like this the slippery slope where retail sounds great but sometimes it's just a feather and a cap or a vanity metric like if if you if you have a model that works in your retail stores and the farmer's market and fresh direct where it's a direct program that's great but you got to continue to grow depth in those channels and then pick one more channel and grow that and then pick another And that's what we did at Choms. We say we're a 13-year overnight success. I mean, it took us a long time before we approached the targets of the world, before we went to the club channel. Because if you go too quick too early, it can really start unraveling and introduce so much complexity and cost where it can materially challenge the business. That's great advice because I always feel like I'm a little fish in the sea. And it's true. I should just stay focused on those first customers and continue to serve them and get that feedback. And again, also watch the velocity of the repeat purchasing in the store. Zachary, are you doing any e-commerce direct to consumer or anything like that? Uh, we actually used to, uh, sell on QVC network. We did for about two years. Um, we don't do it now because shipping costs are so high. Um, but we are looking into doing e-commerce again in the future. Yeah. I feel like I, I get like these frozen pizzas from like Gino's East from people in Chicago, like these other, like, I know it's got to cost an astronomical amount, but they're doing it for like holidays or seasonal stuff. So it might be something for to look into, especially if you have people that are just kind of diehard fans of the brand. And maybe even just reach out to them and just kind of survey some of your customers if you have their contact info. But I would just try to find out from them, like, would you ever buy these for a gift? And just kind of start small with it and see if it works. And then you might be able to scale out from there. That's great advice. Our email box gets flooded every holiday with thousands of emails. Can you ship to California? Can you ship to Texas? So I will definitely do that. Awesome. Zachary Bonder, co-owner of Noble Pies. Thanks so much for calling in. Good luck. Thank you. Thanks, Zachary. Appreciate it. All right, we're going to take another quick break, but we'll be right back with another caller. Stay with us. I'm Guy Raz, and you're listening to The Advice Line, right here on How I Built This Lab. Welcome back to the advice line on how I built this lab. I'm Guy Raz. And today I'm taking your calls with Rashida Lee and Pete Maldonado of Chomps. Let's bring in our final caller. Welcome to the show. Hey guys, before I introduce myself, I just want to say a long time listener, first time caller. Awesome. Years and years, but I'm also a huge Chomps fan. So we have them piled up in our pantry at my house. So I'm fanboying out a little bit here. I'm going to be perfectly honest. My name is Josh Schrenko. I'm the co-founder and president of Achigan Brand. And we are the official brand of smallmouth bass. Awesome. So tell me what you guys make. What do you sell? So we started with kind of the easiest thing we could start with, which was apparel. Okay. Apparel around the theme of smallmouth bass. Okay. Yes. Exactly. So quite niche, but we, yeah, started doing apparel. And to be honest, I don't want to get too much into it, but I started a podcast seven years ago and sort of found out there was a tribe in this like super nerdy corner of the fishing industry that I was super passionate about. And I was like, hey, I want to work in the fishing industry for a living. And I was like, I'm just going to start my own thing. So I partnered with a couple of good friends of mine who are super talented artists, and we started putting shirts and designs and hats and that sort of thing and put it on a Shopify platform. And, you know, we've been keeping it rolling. See, I love this. So there are lifestyle brands around, obviously, golf and other, you know, sports and even fishing. You're focused on like a niche of niche, smallmouth bass, lifestyle brand. And what, what, tell me like, guys, I'm looking at your website now. It says for those who bleed bronze, which is the color of the fish, right? Can you explain the passion for like fishing for this particular fish? Is it just because they're available and there, or is it just, there's a particularly just thing about going for this kind of fish? Yeah. How much time do you got guy? Cause I could go on. Small mouth are awesome. So they, one are native. So it's really cool to think like our our brand is a Cheegan, which is the Algonquin word for smallmouth. And that translates into one which fights. So they are super awesome fighters. So they jump really high there. They're kind of like the hip, cool fish in bass fishing. Largemouth are a little bit like lazy. They don't like to move a lot. Smallmouth are like crazy. They are really fun, fun to catch. Right. And do you release them or do you eat them or both? So we say this frequently. Well, actually, at the end of every podcast, free the fighter. So we are advocating for conservation. So we definitely promote catch and release. Oh, that's cool. So you catch them, release them. Wow. So really, it's like about the sport. Okay. So you've got this apparel brand. You still have shirts. I'm on your website now. Shirts, hats, all around this project. Tell me a little bit about how the business is doing. yeah so we're in year we just started year five um we have expanded into a couple different things um we run an online board game for fishermen and then we also just last spring we launched our first lure in our line of fishing lures which is kind of the in our pipeline that's the long-term strategy is like build out a several skews of lures and then really start to look at getting that into retail and that sort of thing. We can't produce them fast enough inside of our small little office here. They sell too fast. So we're looking for a contract manufacturer right now to do that. And we're also prototyping with the stuff we're making in-house. Based on what you're selling right now, what'd you do in sales last year? So we just missed the $100,000 mark last year, which that was a big goal of ours to hit that. That's still pretty great. And most of that is coming from hats and shirts? Yeah. The lures definitely are like a little bit of a hack because we can sell as many as we can make. But yeah, still the majority of our sales are apparel just because that's what most of our inventory is. Got it. All right. And before we dive in further, what's your question for us? Yeah. So I'm at a place in my business where I want to jump off and I want to do this full time. I have two kids and a wife and I'm not the at the age or position in my life where I can eat ramen for two years right so I have to like have some capital to work with to be able to do this and it is you know you guys talk about cash flow that's a huge huge challenge how like strategically what path should I take to get to this full-time because I have so many things I want to do like This is like I'm so passionate about this business and really just fishing in general. Josh, you said you brought up under $100,000 in sales last year. Just very briefly, what is your full-time job? What's your day job? Yeah, I own a medical distribution company. So we sell orthopedic rehab equipment, and we service the local, like central Indiana and Louisville area. So, yeah. And you want to ideally, you want to focus entirely on this and you want to know when, I guess, when to make that leap. All right. Pete, Rashid, you guys, I'm sure I have a lot of thoughts on this. You started, I mean, Pete, certainly you had all different kinds of businesses, real estate, and that didn't work out. And, you know, and then you start this thing. Thoughts, questions, comments for Josh? Yeah, I'm going to let Rashid kick this one off. I think it's a really interesting topic, especially for Pete and I, because we always joke around like our partnership was not always great at the early days. And it's really because Pete went full time about four years into the business. That was in 2016. And I went full time in 2018. So there was that two-year time period where Pete was full time and I was part time. and I think ultimately the question I have and you don't necessarily have to answer it but it's something to think about and reflect is like you mentioned you're doing 100,000, you mentioned you have a family, you mentioned you're not gonna eat ramen, right? So you have to start thinking about it's like what do you need to support your life and at what point can you scale the business to get there, right? And how much risk can you take And then how much risk can your partners take to run the business So it like those are it really kind of self where you have to figure out what can you do to get there And, you know, you have the entrepreneurial spirit as far as like creative and ideation, but like success is, I always found it's rooted in focus, right? And that's the hard part about it is trying to figure out, right? You have an apparel business, but I looked at online and it looks like this isn't a it's not like a functional apparel right where it's like technical gear for it's right it's more it's purely lifestyle right but then you transition quickly into a purely functional lure side of the business right because you found a niche so that's where you try to think about is like take a step back to say like where do you want the brand to go ultimately and have a clear path to get there and also one that can support your lifestyle right and your family yeah Yeah. And I would say that it's a little bit of like a self-fulfilling prophecy, right? If you don't go full time with the business, it's not going to get where you want it to go. Unless you have a viral moment or you have this like breakthrough, which for you guys, that was the call from Trader Joe's, right? Like you got a call and you're like, hey, like we got a million dollar PO. Let's go figure out a way to fulfill it. like I could keep doing this as, and I'm content to do it for a little while longer, like just kind of grinding it out and kind of waiting for something to happen. I'm more of a person that wants to make things happen though. And I am like, Hey, do I need to, uh, raise some money? Which I have never done. And we have had people approach us, a lot of people asking to invest in this business. And it's, I don't, I don't even know what I'm doing there. Just be honest. Do I need to raise money right now? We're bootstrapping. So I'm funding it with my personal, you know, finances, which I haven't, I don't, it, it, it is profitable to the point where I don't have to keep putting money into it, but it's also like, it's not, I'm not, I don't have a bunch of bankroll that I'm making to be able to reinvest in the business. We just kind of keep doing what we're still doing. So yeah, Josh, I think I'm going to like maybe speak out of both sides of my mouth here because it's like, okay, you've got this really niche audience, which is great because it's going to allow you to make an impact and build a brand within that small audience for a small amount of money. That's exactly what Rashid and I did within the CrossFit community back in the day. We had no money to do it, but we went door to door and basically did what we had to do to build a brand within that community. That's, you know, and then we kind of were able to snowball from there and add other communities from there. But I think for me, like you're, I'm looking at your clothing and then you have your lures. You have a lot of skews across the portfolio here. That's going to require a lot of capital. So it's like, okay, that's going to, if you pulled that back, you limit the size of the business. It's kind of like a, you know, but you have to figure out something. I think you need to focus now on what's going to generate the most revenue for you. So you could actually build this to a place where you could actually go full time and focus on it. If that's what you want to do, I'm guessing from a margin perspective, the lures make you more money than the apparel. Oh yeah. Yeah. Yeah. Yeah. Yeah. We'll all, we'll always keep a apparel just because I that's, you know, it's not free marketing essentially that produces revenue. But, um, yeah, I do think our future is and the lures. And then we have a couple other like just like things in the pipeline that we've talked about doing that could be have a wider appeal that we could sell on like some workplaces like Amazon, that sort of thing. And Josh, to your question, when you think about like, you know, what signals that's time to go full time, I think for us, you mentioned the Trader Joe's PO, but it wasn't necessarily just the PO. It was really around when we saw the sales performance and the repeat rate, and we saw that the product was really working, right? You mentioned the lures. You can't make them fast enough. You keep going out of stock. So like, obviously you have something there. Now what you need to figure out at the unlock is like, how do you see what high is high, right? How do you assess true demand? Because if you're going out of stock and you're running out, like you don't necessarily know what the ceiling is. It's like, to me, you need to solve that. And that's gonna better understand like what is the potential. And then like you said, most of these technical brands provide a technical offering and they wrap it apparel is a value add right and so i think you've already proven you have cool fresh designs that it's are going to track you need to create that anchor technical solve which you're circling right now but once you figure out the unlock and how do you scale it i think that's going to answer your question on are you ready to go like and then and then think about retail then think about this but like look pete and i love e-commerce we love direct to consumer like it's such a great way to scale quickly and learn your product and grow but i think you're close i think i my my read is like figure out that unlock on how to scale the lures faster yeah and i'll add to our brand is like we don't we haven't paid a dime in advertising like we don't it's a hundred percent organic it's word of mouth we use instagram that's kind of our like growth engine, but it's all organic posting. So I feel like when, if I had a little bit of capital to work with, if I had more time, I could pour gas on this fire and I have a path there. It's just like, it's, it's a tough way to, you know, it's a tough way to jump into it. It's scary, honestly. You have, you have two other co-founders, correct? Is that, I saw that on the website. Yes. Yeah. So, you know, Rashid and I, you know, I went full time first. I think we were doing in like the four or five hundred thousand range. And then Rashid didn't come on until we were doing like 20 million. So it was a big, like big gap. It was like maybe a couple of years later. Yeah. But you could find you could figure out like, you know, what works for you guys. Maybe maybe one of you guys go full time and the other two are just kind of, you know, work your other job and then play more of a support role. Or maybe take, you know, it's like shift work or something like that. But this thing definitely needs full-time attention if you actually want it to scale. I think that's great advice. I mean, I also think, you know, at the end of the day, you will know when it's time, right? Right now, you're sort of worried about, you mentioned you don't want to eat ramen and, you know, you can't live on the salary and support a family. But when it starts to feel like doing this part-time is riskier, that's when you know. When you start to say to yourself, actually, it's safer for me to jump into this full time, you will know that. That will be clear to you. Guy, you always have sage advice. I always hear that from you after these interviews. Well, it's an awesome opportunity because you've tapped into something. Clearly, there's a lot of passion around. And, you know, there doesn't seem to be a lifestyle, a real lifestyle brand around smallmouth bass. So it's a cool idea. And I just, I think you can really run with it. So good luck. Thank you, guys. I really appreciate you having me on. Yeah, Josh Schrenko, co-founder of Achigan. Good luck. Keep us posted. Thanks, Josh. Yeah, it's, I mean, it really, like, it is amazing to me how there are all of these. And, you know, we hear about a lot on the show, these small communities, like these niche, would seem to be niche, but actually they're much bigger than people realize, right? Like all these people who fish for a certain kind of fish or who are interested in a very particular kind of watch or, you know, golf club or whatever it is. And people are building micro brands around these communities, which are becoming interesting businesses. Yeah. It's, it's awesome. And it's also interesting to kind of think through, but like nowadays with AI, the way it is, like, cause a lot of them were talking about like, how do I scale and how I build a team and all of these things. And this is something that Rashid and I, back in the day, we didn't have access to AI. It was all about getting strappy and using third parties. I wish I had better advice for them because we don't even know how to use that. But I hear so many times people talking about one person running an entire organization using AI and automation. And it's amazing. Yeah, absolutely. Guys, before I let you go, if I, and Pete, actually, I think you answered this question last time we brought you on, maybe you'll have a different answer now, but I'll start with Rashid. If you could go back to when you guys started Chomps and knowing what you know now about the business and what you've learned, what would have been helpful for you to know 13 years ago when you guys launched this brand? That's an interesting question. I mean, I think, I believe it's fortunate that we didn't know what we know now. I think it is honestly one of the reasons we're here today. Like we had a lot of folks in our ear giving us advice, but we just did what felt right. I think I'm glad that we went a little bit blind and ignorant. And I think it allowed us to make the right decisions to build it the way we built it. Yeah, we still have a lot more work to do, but I think we've built, we have a lot of momentum. We're in the right place in the right category with a fantastic product, brand and team. So like, I don't know, I I'm glad we went a bit ignorant and we didn't know what we didn't know. And I think it allowed us to get to where we are. Yeah. So I would say it's just being patient, right? With time and, you know, staying focused, things will work out. Essentially. We've been on this chomp. We call it the chomps rollercoaster because it's never just linear right we're just we are either you know in having a terrible day or an amazing day and there's nothing in between um that's kind of been the entire ride since for the past 13 years so um i would say you know it's being patient and working through issues whether and and by the way not getting complacent when things are going great and rosy because it's gonna like challenges will come your way so just be ready for it yeah pete maldonado rashida lee uh thanks so much for coming back on guys. We appreciate it. Thanks for having us. Thanks guy. Appreciate it, man. Um, and by the way, if you guys haven't heard Pete and Rashid's original, how I built this episode, go back and check it out. It's a great, terrific episode. You will learn so much. We'll put a link to that in the show notes. And here's one of my favorite moments from that interview. What was their purchase order for 1.1 million sticks? And it was larger than the previous year altogether in a single PO. Wow. And I'm thinking how this is, I was like, this is not what we discussed. This is way more than what we discussed. And so I was like, give me a second. So I go in my room, I build my spreadsheet, I'm calculating the total, like what does it actually look like? So I'm like, Pete, we need, I don't know, it's like one point something million to be able to fund this. And so we then had to figure out how we were gonna get the money to even fill this PO. Hey, thanks so much for listening to the show this week. And by the way, please make sure to check out my newsletter. You can sign up for it for free at GuyRoz.com or on Substack. And of course, if you are working on a business and you'd like to be on this show, send us a one-minute message that tells us a little bit about your business and the questions or issues that you're currently facing, because we would love to try and help you solve them. You can send us a voice memo at hibt at id.wondery.com or call us at 1-800-433-1298. Leave a message there and make sure to tell us how to reach you, and we'll put all of this information in the podcast description as well. This episode was produced by Kerry Thompson with music composed by Ramtina Ablui. It was edited by John Isabella with engineering from Jimmy Keeley. Our production staff also includes Alex Chung, Elaine Coates, Neva Grant, Noor Gill, Casey Herman, Chris Messini, Catherine Seifer, and Ramel Wood. I'm Guy Raz, and you've been listening to The Advice Line on How I Built This Lab. you