In response to Will Nitze, founder and CEO of IQBAR, success in a aggressive market requires discovering its uncompetitive niches. He did that together with his flagship protein bar, which is plant-based, low-sugar, and plainly labeled. That was seven years in the past when he launched the corporate with a $75,000 Kickstarter marketing campaign.
Quick ahead to 2025, and IQBAR additionally makes IQMIX (hydration) and IQJOE (espresso). All promote mind well being with out competing towards one another.
Will and I just lately mentioned his journey, from the preliminary capital increase to scaling income, including merchandise, and managing wholesale channels. Your entire audio of our dialog is embedded under. The transcript is edited for readability and size.
Eric Bandholz: Give us a fast rundown of who you’re.
Will Nitze: I’m the founder and CEO of IQBAR. Our hero product is dietary bars, however we additionally make IQMIX for hydration and IQJOE for fast espresso. Roughly 55% of our income is wholesale; our direct-to-consumer ecommerce web site and Amazon account for the stability. We’ve raised slightly below $10 million since our launch seven years in the past.
Bandholz: How do you stand out in such a aggressive market?
Nitze: The bottom line is breaking down the competitors into subcategories. Within the protein bar market, the saturated class is animal-based elements. However once you concentrate on plant protein, low sugar, and clear labels, you may carve out an area with a lot much less competitors however nonetheless substantial. It’s about discovering the uncompetitive niches throughout the broader aggressive panorama.
I acquired into this house as a private ardour. I used to be dissatisfied with my software program job and commenced exploring low-carb diets, ultimately touchdown on keto. I used to be particularly thinking about mind meals and observed that, on the time, nobody was providing ready-to-eat choices. Most mind vitamin is available in capsule or powder type. I launched a Kickstarter marketing campaign that raised $75,000, validating the idea. From there, we pivoted based mostly on buyer suggestions, specializing in protein and clear labels.
The mind angle is beneficial and differentiated, nevertheless it’s the deal nearer, not the deal opener. Folks store our merchandise based mostly on the protein rely — the place it got here from and the way full it’s — after which sugar.
Our technique has been to increase the product line with out cannibalizing our core bar product. Many manufacturers lengthen their product strains in ways in which compete with their current objects, like transferring from bars to peanut butter cups. We wished our new merchandise — hydration and occasional — to enhance our bars, aligning with our mind and physique vitamin mission however not competing. We additionally thought of shelf stability and ease of manufacturing.
Bandholz: You may have simply 9 staff. How do you preserve such a lean workforce whereas scaling?
Nitze: Recognizing my weaknesses is crucial. I’m not nice at hiring, so I depend on a trusted circle. My spouse is our chief advertising and marketing officer and head of ecommerce. I maintain a detailed reference to everybody on the workforce. We use exterior companies for pay-per-click adverts, search engine marketing, and Amazon administration. We work intently with these companions and our producer to maintain issues working easily with fewer full-time staff.
We by no means decide to long-term company contracts with out an exit clause. Most companies function on annual phrases, however we guarantee we are able to depart with 30- or 60-day discover. We’ve labored with our Amazon company for over two years; they know our enterprise inside out. We applied a bonus construction for them to incentivize efficiency. This deal labored nicely for each side, because it aligns their objectives with ours.
Bandholz: How did you develop your wholesale technique?
Nitze: Once more, our enterprise can be 55% wholesale this 12 months. We imagine in an omnichannel method, particularly brick-and-mortar retail. Digital-first is crucial for constructing credibility within the retail world. We are able to present potential retailers knowledge from our ecommerce web site, such because the variety of clients of their commerce space. Brokers play a key position in retail progress, particularly these related with massive chains, corresponding to Walmart and Costco.
The bottom line is to work with retailers who pay rapidly. Amazon, for instance, pays each two weeks. Past that, elevating cash is essential. Some folks idolize bootstrapping, however elevating funds means that you can scale rapidly. Within the early levels, you want capital to fund stock, which turns into the spine of your small business. One other secret is having a excessive gross margin, which lets you reinvest into extra stock. Finally, scaling up helps preserve money circulate.
Bandholz: Was it exhausting discovering a producer?
Nitze: It was a problem. Our first co-packer — the corporate making the meals and packaging and labeling it — was nice for small volumes however couldn’t scale. Finally, we switched to a co-packer that might deal with increased volumes. This course of was painful, because it meant high quality management disruptions. However as soon as we discovered the precise accomplice, we might scale considerably. Now, now we have a co-packer that may handle thousands and thousands of items yearly, and that’s been crucial to our progress.
Bandholz: The place can folks contact you?
Nitze: Attain me by our web site, EatIQBar.com, or LinkedIn.
