Cash Flow Positive Growth Without VC Money: The Bezi Method
(Listen on Apple or Spotify. Full transcript below.)
Bottom line up front: Cash flow positive growth is transforming how smart food entrepreneurs build businesses. Ilay's approach with Bezi proves strategic expansion works better than racing to grow.
What if everything you've been told about growing a food business is wrong?
While most founders chase investor dollars and door counts, Ilay is quietly building something different with her labneh brand Bezi. Her growth strategy turns industry assumptions upside down.
The Rebel Path to Cash Flow Positive Growth
Meet Ilay: the consultant who discovered her passion for food during a cheese-making farm internship while her peers pursued traditional business roles. That decision to follow her instincts would later prove crucial to her entrepreneurial journey.
"Everyone else had like a completely different summer internship," she recalls. "I was just out on a farm, milking cows."
But it was her experience at Turkish startup Getir—watching a $12 billion company navigate funding volatility and layoffs when the money dried up—that shaped her cash flow positive growth philosophy.
"Money is very fickle," she explains. "You might be the king of the world one day, and the next day you don't have the money anymore."
This experience shaped her approach to building Bezi: what if a food brand could achieve cash flow positive growth from day one?
The "Shallow Water" Strategy
While competitors celebrate hitting thousands of doors, Ilay has taken a completely different approach. She calls it her "shallow water" strategy, and it's generating impressive results.
In nine months, Bezi has achieved genuine velocity paired with cash flow positive growth. Her unconventional move? Deliberately limiting expansion.
"We rather have 100 stores that is selling like crazy," Ilay explains, "because that's when you create momentum."
Her growth model is built on data-driven decisions. Every retail partner and expansion move is calculated to maintain profitability while building brand equity.
The Data Intelligence Operation
Most brands treat product demos as simple sampling. Ilay has transformed them into a sophisticated system that fuels her growth.
She runs 5-10 demos per week across New York City, collecting detailed performance data from each session. This systematic approach has allowed Bezi to predict performance, optimize team deployment, and maintain positive growth as they expand to new markets.
"I have a record of every demo we've ever had," she reveals.
Breaking Distribution Rules
Ilay's approach gets unconventional with distribution: she's doing it herself. While brands rush to sign with major distributors, she maintains direct supply chain control.
This decision is fundamental to her cash flow positive growth model. By avoiding traditional distributor relationships, Bezi sidesteps listing fees, promotional costs, and margin pressures that crush emerging brands.
Premium Positioning Strategy
Bezi launched exclusively in premium New York retailers like Citarella, Union Market, and Brooklyn Fare. This wasn't about brand ego—it was calculated to support cash flow positive growth.
"We tried a couple of stores in deep Brooklyn and completely failed," Ilay admits. This testing revealed crucial insights about how the retail environment impacts both brand perception and profitability.
Her systematic retail partner selection has become a cornerstone of sustainable expansion.
The Self-Sufficient Approach
While most food brands chase investment, Ilay is proving that cash flow positive growth creates more options. Her financial discipline has actually attracted investor interest, but now she can be selective.
"We want to build a business that we can stay afloat ourselves," she explains.
When economic conditions tighten, brands dependent on external funding struggle. Having positive cash flow provides resilience that's increasingly valuable.
The Results
Ilay's success challenges the assumption that growth requires cash burn. Her methods for maintaining positive cash flow while introducing a new (to the U.S.) product involve several unconventional strategies that support sustainable expansion.
Most importantly, this approach has allowed her to build exactly the business she envisioned. No board pressure, no growth-at-all-costs mentality—just cash flow positive expansion.
"We're nine months old, we're a baby," Ilay reflects. "But the business is doing well. We're selling a lot. People love the product and we can grow organically."
This organic growth has created something rare in specialty food: a business that's both growing without burning cash.
Curious how she built this?
Listen to the full podcast episode to hear Ilay share her approach to sustainable growth through data-driven decisions, and a very clear vision for what she wants to build.
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Episode Timeline
00:00 Introduction and Listener Engagement
01:57 Spotlight on Bezi and Product Passion
07:00 Founder's Journey: From Consulting to Cheese
13:58 Product Development and Production Strategy
20:06 Retail Strategy: Direct to Consumer vs. Retail
26:09 Cash Flow Management and Growth Strategy
32:04 Data-Driven Decisions in Business Growth
35:12 Strategic Growth: Quality Over Quantity
38:05 Navigating Customer Perception and Market Entry
41:00 Introducing New Products: Challenges and Opportunities
45:27 Funding Strategies: Building on Your Own Terms
48:15 The Reality of Building a Sustainable Business
52:24 Modeling for Success: Avoiding Common Pitfalls
Full Episode Transcript
You're listening to the Good Food CFO podcast. I am your host, Sarah Delevan, and with us as always is our producer, Chelsea Stier. Hey, Chelsea.
Hey, Sarah. We are airing our very first BABOYOT episode of the season today. But before we even get into that and talk about who we're hearing from, I want to share a review with you. Okay. So this review comes from Lori Phillips of Rocky's Ice Cream Tacos.
And Lori said, I found your Good Food CFO podcast via Emily Winston, good friend of the podcast, at Boichik Bagels. This prompted me to binge all of your episodes. I'm now up through season 10. I hope she's gotten past season 10 at this point. And I highly resonate with so much that is discussed on the podcast episodes from a vision ethics values standpoint.
And there are so many little things that you've said that make me believe that we should be BFFs. I love that part of the review. I actually had the chance to meet Lori virtually, but we were able to do a consult, kind of just have a conversation. And it was so lovely. She really has an awesome business and it really is also rooted in that good food mentality. I don't want to share too much without her approval, but I think it's really inspiring to meet a founder.
who says, you know, I've created a profitable business. I have made something that I want to share with other people. And hopefully one day we'll have her on the show for a BABOYOT episode too, but I love what she's doing. If you are in, you know, sort of the San Francisco area, check out...
Rockies ice cream tacos. They have an amazing fan base and like an amazing clientele. You can get their products for catering and stuff like that. So just really want to thank Lori for her review, for taking the time to binge our podcast and for the opportunity to get to talk with her one-on-one and learn more about her business and what she's dreaming up for the future. Yeah, I love that. Well, speaking of having Lori on for a BABOYOT episode, I want to talk about today's episode.
with the co-founder and CEO of Bezi. Okay, before you share anything, I have to say, and I say this in the episode, I believe, but this was one of my favorite products I tasted at Expo West. yes. It was one of those things where This goes back to my days as a food sourcing person where I would taste something and I'd be like, this is delicious and people need to have this. Then I would have that moment where I'm like,
are people going to like this as much as I do? For some reason, is my palette unique? You know what mean? And no one's going to think that this relatively simple product, a lebnah, is as good as I think it is. And then I was so excited to A, take a container home and share it with Nathan, my husband, because he also really enjoyed it. But then I started seeing other people talking about it on social. Kelly Bennett,
Nicole from Bread and Butter Law and so many other people were loving it. It just made me so excited to see this excitement for this product that I really, really liked. Having the opportunity to talk with Ilay, who is the co-founder that I got to interview, was really, really fun. Yeah. I have to say, because I've obviously listened to the episode as I edited it.
This is a really, really good conversation between you and Ilay. I think that there's so much that she really takes a very strong stand on in her strategy and her vision of the business. You can just hear her throughout the conversation, almost repeat it over and over in all the different aspects of the way that they're building the business. She has
made a very deliberate and strong decision to I don't want to say remain small. That's not the way to say it, but like start small, start local, or start regional and really make sure that they have all of their ducks in a row before they go or do anything else. Yeah. And she mentions in the episode, know, expanding to the West Coast, specifically to San Francisco.
So they will be technically a bi-coastal, if you will, product in the relatively near future. But even with that, there's a slowness, a deliberateness, a focus on data, a focus on understanding the customer. And we've talked about that so much here on the podcast, Chelsea, how important that is to an overall successful business and a successful financial strategy. And you're right.
repeats it in different ways, you know I mean? Throughout the conversation and throughout talking about her strategy, and I love her commitment to this is how we are doing it. I need the data. I need to be close to that. She also really talks about the fact that they have a certain amount of investment to start this business. She talks about how they're producing the product and the fact that
The other thing that's influencing the way that they grow is her focus on not burning a lot of cash, right? This mentality of we may take on investment in the future, but we're not running the business today. That's a sure thing. I think that's also a really smart approach. Yeah. I actually really liked to learn a little bit about Ilay's background, right?
co-founding Bezi with her partner because I think there's some real keys in the things that she's been through in other business that really shaped the way that she is building Bezi. Yeah, it's really interesting to hear from various founders, like the paths that they've been on, the other jobs they've had and how that has influenced exactly what you said, the way that they run their own businesses.
Yeah, it was a great conversation. agree with you now reflecting on it because it's been a while since we recorded the episode. It's a great one and I'm excited for founders to hear it. Yeah. Well, should we dive in? Let's do it. Hey there, it's Sarah. If you're enjoying the podcast, I want to invite you to become a BABOYOT member. It stands for building a business on your own terms and your membership directly supports the continued production of this podcast and helps us reach our goal of supporting one million.
food founders. As a member, you'll get access to our live coaching events, have your brand featured right here on the podcast, be the first to test our new tools and receive a 10 % discount on all of our tools and services when you choose an annual plan. Join fellow successful founders at the goodfoodcfo.com slash BABOYOT. That's spelled B-A-B-O-Y-O-T. Together, we're changing the way that food business is done. Now, back to the show.
Ilay, welcome to the podcast. Thank you. I'm so excited to talk about Bezi. It was one of my top favorite products that I tasted at Expo West. I was so happy to see that lots of other people felt the same way on social media after the event.
Thank you. I'm happy to be here.
Yeah, we had a fantastic expo and at that point we were like six months old just in New York City. So it was almost like we were launched towards like the whole universe. Yeah, so I'm glad you discovered us.
Yeah, it was amazing. I'm glad that we didn't meet there, but I'm so glad that we're able to connect here. Yeah. Yeah. So let's go to the beginning of things. Now, I know that you are from Turkey, as is your co-founder. Your co-founder happens to be the heir of a dairy company, which is fascinating. tell me all about why you felt like, we need to bring Lebna to the US and then how the two of you got connected. I want all the details on the beginning.
much with my co-founder yeah
So we have like different paths actually, and then we found each other about like maybe like, that's three years ago. But my background, was a consultant at McKinsey majority of my life out of undergrad, and then came here to New York about seven years ago to Columbia Business School. So it was a perfect program that you would be sponsored for two years, you could do like just explore, do whatever you want. And then you need to go back to McKinsey to work for another two years and your school would be sponsored.
So I came here with that and then used those two years to do whatever I wanted. And that was at that point, cheese. So I worked at a farm, milk cow, milk sheep, learned to make cheese from scratch. It was my summer internship. Well, everyone else had like a completely different summer internship. That was what I really wanted to discover. No agenda whatsoever, but it was just like a passion that I thought that I had the freedom to actually explore it a little bit.
Never thought anything out of it, honestly, but it was such a funny thing because a lot of my friends were like investment banking and doing like a lot of like real business school type of jobs. And I was just out on a farm, milking cows. So they tried to call me like cheese lady. It was like a fun thing. I experimented on recipes on my own. I'd like to do a healthy cream cheese. This was back in 2019. So I don't think much out of it. I'm like.
All right, this was fun. And then go back to McKinsey became engagement manager there quite fast. was doing financial services, then transitioned over to this company called Getter, which was a scale up out of Turkey who was delivering groceries in about like 15 minutes. So a lot of my McKinsey like team members back in Istanbul were helping to do an international launch. So they were like, why don't you join us? It's going to be fun. And at that
It was a point in my career that I really wanted to do something that was more tangible than becoming a consultant because I was consulted majority of my life. I was quite good at it, but you never necessarily have the real experience of what is it to build a business, to own a P &L, like to really own a team. McKinsey is a great place to learn a lot of things, but when you're there for so long, I ended up craving really owning P &L.
So Getter gave me that opportunity. So I joined as head of transformation, then moved to like head of marketing and then head of merchandising, which was perfect because it was a window into groceries. But again, didn't want to be in groceries. It was very surrounded, but it's had a lot of friends who thought that this would be like a great learning platform. But that's where I met Hasan. So Hasan is one of the biggest cheese maker families in Turkey. And he also ended up like working in turning up Getter. It was COVID.
So I joined Getter around like late 2021 and 2022 I was there. So Hasan joined in 2020 because it was COVID, schools were remote. He was like, I'm just take a gap year and join this very exciting scale up to learn a lot of things. And at that point Getter was $12 billion company. was like everyone that was Turkish abroad wanted to like contribute, like everyone was like kind of working there. So he jumped ship before I did and he was working
for another person in another team. So him and I met at a leadership conference. He was like the one putting together the slides. And I was like, oh my God, I love cheese, like let's be friends. And he is not like a cheese person. He just like born into this family. So he was like, okay. And then we started chatting and became really good friends. And I kind of have him come to my team. I went to his manager and I was like, this guy's really smart. Like I have a big project. I need him. Can I just like get him for the summer?
So we started working together again. At this point, we don't have any idea of like launching a cheese business, launching Labneh, like none of those. were working for Getter together. Hassan left after his internship and went back to the family company, whereas I stayed at Getter for like a year later. But when he went back, he was like, we're thinking of doing something in the US. So at that point, Bachuan Hassan's family has like about like 10 years of a...
US like import export business that they're sending their Turkish ethnic cheeses and their Turkish Batchewan packaging. So nothing specific to this industry, not necessarily as a CPG, but selling it in like Arab supermarkets, which is like a great market. I don't know, at that point, I think it was a point in my life that I had a lot of things I think come to me. And there was a point in life, especially I think going through to get our experience, which was very turbulent, like we had a lot of cash, had non cash, we would launch business.
There was, think, a lot of things that was turbulent that was happening. And I wanted to pursue my passion. This was my passion. And I kind of like didn't think about it all that time, but at that point it all came up to me very randomly. Again, this wasn't planned. That's not why Hassan and I met, but I pushed him the idea of bringing Labneh here as a separate entity, really Americanizing the category. So American branding, American company, an entity here, American flavors.
changing the recipe. So the best eat out you're eating right now is not Turkish law made Turkish like everything love me and that does not exist anywhere in the world. Those are the things that I built in my kitchen literally over there and kind of translated into a product. So we started that journey. This was, I would say August of 2023. So we started like working on recipes, I had a full time job on the other side, but we launched in September 2024.
wow, okay.
So that's how we met. It's kind of serendipitous how this idea came together. Like if you look back at it, everything about my life kind of makes sense. But while true that journey, there was no correlation. That wasn't planned. Hassan wasn't planned. Me working at a farm wasn't planned. It was very much like a gut feeling that looking back at it kind of makes sense. But that's her story.
love that. Okay, so you're developing or you developed the product in your kitchen. I have to say, the consistency, I like a tang, you know I mean? But I also like, I love what Bezi tastes like actually. love, yeah, the consistency of it. I the flavors of it. I even tasted the hot honey, which I'm not a fan of honey in general. And I taste it and I was like, dang, this is really good. Every flavor is so good. So well done on all of the flavor creations.
So when you are starting to think about launching, are you working with a dairy co-packer? How did that come to be and did the product officially come into existence?
So we work with Bacchus and Hasan's family. So we have a factory in Turkey, which is like really big. It has like 200 tons of labneh production capacity per month. So we were lucky to actually sit on like a factory structure. So I don't have a cold packer, I have a factory and I that changes a lot of things. In terms of the recipe creation, we had a very specific vision personally, like what the product needed to taste like. And I think
So hot honeys are the latest one. We're not in market yet. That's going to be in like July 15th. So expo was like a teaser of that. That is literally like us getting Turkish pine honey and or for chili flakes and building that recipe. I think it's a lot of it is like, or got feeling of what the product should taste like. And we're so lucky to have a team behind us to take that vision and be able to build up like a real CPG product with no added, there's nothing in the factory capacity.
We were very lucky on the structure, I like this job wouldn't be possible without that. Like the very innovation and new category would not happen if you don't have like a vertical integration between our production and the brand.
Yeah, I think that's so great to point out. I think so. you're producing in Turkey and then importing. It's really awesome. And one of the things you mentioned, we do a little questionnaire, you know, pre interview for all of those listeners who might not be privy to our to our process. But you said that you were direct to retail. So you didn't you didn't start to see, which is what a lot of brands do. Tell us about
the thought process behind that and the decision to go direct to retail.
So I think there are two reasons why we wanted to do it. The first one, just in terms of like think of the DTC products, a refrigerated berry dip is not a DTC product. Like you would not necessarily buy, we're like $6, rest size is 49.
You wouldn't buy a $6 Labneh to pay $25 of UPS one day shipping and frozen is different and being so much easier Refrigerated is held in between because I cannot freeze the product. I can't warm the product So the structure of that would absolutely not make sense But the second piece is like as a founder I also didn't want to build a DTC brand and I know like a lot of People have different opinions about it. My dream is that you would try Bessie
in a grocery store, hear it from your friends, really love it and you buy it every time you go into your grocery store. It's not like an occasion that you go to a website and order it. It's not an occasion that you see one influencer and be like, let me try it from the TikTok shop. The brand that I wanted to build, of course, this is tougher. And that's why we went very slow and still going to go slow. But I want to be a retail grocery store brand. Like
I think there are fantastic examples out there like good culture, like actual ledges, like really good grocery store retail way. That's what we want it to be. And unfortunately, DTC is a huge distraction because if I was a buyer and I was a buyer some portion of my life to get her, which we acquired Fresh Drive, so kind of seen a lot of like different ranges. It doesn't feel like real beta to me. Right. Like I know some people do it for like DTC, but it is your platform. You don't get the
almost a competition of being Nexus Habra. That's what we started. We were Nexus Habra. That was our first day out there as Labneh. And I think that teaches you a lot of things about building the category and like facing the master if that's the case for a lot of the CG. But like right on our first day. So I highly recommend what we did, but of course it wasn't easy and it's oftentimes kind of puts us back in terms of the scale we can be. But I'd rather build this that way than the other way.
Yeah. I want to ask a couple of questions around this. So I think it's interesting, the idea of like facing the monster right away. But something I also keyed in on is that you're going slow. So I'm curious about that because in my mind, so the story that I'm putting together in my head based on what you're saying is like, we're going to face the challenge, like the big challenge, day one. But we're not going to do it on such a broad spectrum in like a ton of doors because we don't quite know exactly how it's going to go.
and what we might need to tweak. Is that accurate?
Yes, but also I think the fundamental pieces like I am on top of every sales that happens on Bezi currently. So we're in New York, we're in SF. SF is like a recent thing, so that's the last like one month. I know every grocery store. I went to every grocery store myself. I did the sales myself. I don't have a broker. I don't have a distributor. It is me. And I think that enables us to actually learn so much but also drive so much sales.
that I've either control this growth as I'm building the category because even for us like being in a self like I need to fly there to be able to like see how we're doing and how we're learning. Yeah. And I would want to build a brand that way or else I lose control. Of course, there's a pretty important that you mentioned that like you test and learn we test and learn so much. So the mistakes that we did doesn't kill us. Yeah, we did so many mistakes.
Obviously, but like it is such a like a shallow water that I'm swimming it right now It doesn't hurt me think of me doing this mistake with a UNFI with a national distributor I rather don't want to do that So how we build our growth strategy, which I mean, I'm sure we'll talk more in detail is basically on that matter Like we'll contain it we learn we control we make mistakes in a shallow water and then once we feel confident We're like we're ready to grow so
The business that we did in New York, we're very proud. have very strong velocities. We can stand on the shelf and now we're ready to grow based on that. But of course, we're not ready to grow with national with target. Like absolutely not.
Yeah. Can we talk a little bit about the stores that you chose to launch in and then grow into? Absolutely. Talk a little bit about maybe how you identified customer fit, customer product fit within those stores and what that process was like.
Absolutely. So I think there are two angles of it. One, is this the right grocery store that will create the right brand perception on my customer's mind? For example, a good New York example would be there are bodegas and there are like, like fresh grocery stores like Union Market. So the same customer might go into bodega might go into Union Market. Let's say if it is an East Village, right?
We don't want to be in bodegas. Not that bodegas are bad. If you were in the world of beverage, that would have been fantastic. But those are, when you think of the hot missiles, they're not the best styles. Like they're like the Sabra that was there for like, you know, two years is like literally the energy of those aisles. We avoided those grocery stores and went for grocery stores that created the sense of what our product is, right? It's fresh. is like non-geomalibari. It's good for you. So we literally handpicked.
the grocery stores we want to be in. And currently where we're at, like there's nowhere else in New York that I can grow apart from Whole Foods. Like I topped my list fully. So those would be like Citarellas, Union Markets, Saybars, Westside Markets, Brooklyn Fairs. Those are the ones that the right customer goes. It's a full grocery store store. You would want to buy something fresh out of from that. It's the right brand marketing and then everything else be avoided. One of the mistakes that we did,
wanted to do a test because I mean, a lot of the things we have very strong opinions, but we're like, would this make sense at all? So we tried a couple of stores and in deep Brooklyn completely failed because always theory was right. Like the customer, even though it was the right customer, let's say prospect park, right. Right customer. do so much sales in union market in prospect park, the Bodega next door, we fail so bad.
That's why we avoided those stores and now I'm sticking with my hypotheses, for example, in SF that like I'm in Byright, I'm in Rainbow Grocery, like I'm in Berkeley Bowl, same vibe and I will not be in the bodega of SF because of my learnings in New York.
Yeah. And it's interesting, I was talking to a founder not long ago during a consultation and something that they said was that they were trying to build D2C initially and they weren't able to really drive sales on their website. And so they were struggling there and so they decided to launch and they then launched in retail but through a distributor. And I was really concerned for them because of a couple of things. One was
didn't seem like they really understood their customer. were having trouble reaching them on a D to C level and now they're launching sort of broadly in several DCs through a distributor. like there's so much that I think you don't know. don't even need it. It could go wonderfully well, but it could also go terribly wrong. And so I think I tend to like a strategy like yours that's, let's start small, let's test and learn.
moving from New York to San Francisco with the same strategy, are you still learning things about the SF customer that's different than New York?
Yeah, so we I mean, it's been one month. So we keep at least one month like an organic do nothing Let's see what it performs kind of strategy. So we're now reading that okay and understanding like what sells what doesn't sell which aisle and now we're in the process of hiring the demo team and a Merchandising team to be there. That's gonna give us the second learning I'm gonna fly there to be there to like sit on Louie on top of the product to watch everything
And I think that's going to build learnings. But of course, like, sorry, it is, it is a little bit more challenging because I've been living in New York for about seven years. know exactly which district does what, like which zip code acts in a certain way. Like Upper West Side, they sell a lot, obviously. Right. It is, there's a lot of like Jewish communities there that actually know what Labneh is. So you can see that immediately. And in some zip codes, doesn't like resonate immediately. So I'm trying to learn the same things for SF too.
Yeah, it is a learning process. But I, I am more of an advocate of, I would say, groving close to like, that's one thing that I would really want to do it is challenging in our industry, but close to cash flow positive. So not burning a lot of money. Yeah. And learning, learning, learning, learning in every possible way. And this is like, this is my baby. I don't think it makes sense for us to get a broker or get us like a layer in between because I need to have the pulse on everything.
So I'm planning to do this in a very intense way for the next year too. And then once I have more learnings, I might let go for a little bit, but I take so much joy in that intensity and pulse. yeah, some people open up a couple of DCs and then they're like, blowing up and then everyone talks about it. We're not going to be that brand. That's, that is the challenge of the routes that we're taking.
Yeah. So the idea of aiming to be cashflow positive from day one is like, I want you to scream that from the rooftops because honestly, it's hard. It takes investment in the business. I always tell people you're in debt from day one in your business because a business bank account doesn't come with money magically in it. You have to invest. You have to spend money on
R &D, product development, obviously making those first few rounds of product. But when you're operational and you start selling, I think this idea of how quickly can we get to cash flow positive is one that not a lot of people talk about. So without getting into specific numbers, because we don't share that broadly publicly here on the podcast, what are some strategies aside from slow growth and you saying on top of things that you're implementing in your business to be as close to?
cash flow positive or not burning a lot of money every single month.
Yeah. So, I mean, I think some people have different opinions about that, but I'll tell you my opinion. think we're, so we're nine months old, we're a baby. So we're not, I don't think in a position of getting really excited of a big marketing spending line items when it comes to awareness building, right? We're not doing, we'll send it to a couple of influencers because those things people get excited or like we'll do a big influencer event or we'll spend a lot of money on PR. we're in Bon Appetit.
Like we don't do any that. The only thing that we spend is closest to the shelf. We're doing a lot of demos, managing data like crazy so that I know that my, and I don't use agencies for demos. So what I do for my team with my demos, how much they sell justifies how much we pay them. So that is almost a net positive. because, mean, I believe our product is fantastic and because the product is fantastic, it creates retention.
So it builds that grocery stores velocity high up almost like we saw this with everything bagel one it's hyperbolically selling out and I cannot keep up on that and because the strategy that was like getting people to taste it being in right stores like stores like Butterfield and Upper East Side and that's how like an influencer picked up actually and she posted three times which all of my friends said apparently she was like one of the biggest influencers in New York City but
That's what we're doing. And people see my product there being posted by an influencer. I think that is an ad. Right. It is not. We just, think I have like a really good product that are very obsessive about the retail close to that spending and building velocity. And that's not for us makes sense. But of course there's going to come a point. Let's say we expand into a national chain. That's not, not going to hold because it's going to be crowded with listing fees.
like fees, right? Promotion fees, not just even like giving promotion, like fees to have a promotion happening, this and that. I think that's gonna be a dense, but up until that point, what we're doing is working with small distributors. So we don't have fees, we don't have any complicated structure, it's very simple, they pick it up from a warehouse. We're in right grocery stores, we optimize selling a lot, and every month, like every money that we spend, we have a net-net almost.
good equalization in terms of how much money we spend and how much we're going to get eventually and manage all the data like crazy. I do my own distribution majority of the time in New York, that's how I started. I have access to all the data. So that's the loop that we're sending. And now we have like very, for our business, like a very minimal cash flow that we have calculated how many doors we need to hit with like a
kind of baddish velocity. And once we hit that with the same structures, like repeats, structure, we're going to be like zero on the terms of the cash flow, like, yeah, like a little bit here and there, but that's going to neutralize. And once it does, think that's going to be even like more fun to run the business because it's going to give us the freedom to do however growth we want without the pressure of needing to grow fast. So that's our map. Let's see if it works out.
Yeah. And I think something else I love that you're saying is that being really close to the data and staying on top of it, managing the data. think, as you just pointed out too, the self-distribution or working with a small regional distributor who picks up directly from you, you're close to where is my product going and how much is moving in each store. I think there's a ton of value to that so that you can learn and so that you can manage the data. Are you running promos in any of the stores you're in now?
So once we launch, especially with the DAD and SF, we give about like 50 cents off for four weeks. That's sort of like standard, but we can't go any deeper than that. It doesn't make sense without everything else that is involved. So we run that promo and that's the only promo that we run. But we do like five to 10 demos per week in New York City alone. So the main thing is demos. And for us, one demo...
in like a bad grocery store sells 15 units in two hours. Like low traffic, you don't have a lot of people coming in. But if it is like a really high traffic grocery store, we sell about 50.
whether that data from A, doing them yourself.
So all my teams, I started doing demos myself, then I created this form that I collect from every team member after every demo. So I have a record of every demo that we ever had in Bezi's lifetime. Where was that person when that person come? The picture of the shelf, everything. And we have that data. And that's why I know that like, all right, it's like Francesca is going to Union Market. I know she's gonna sell 30 units.
And 30 in a selling a union market justifies Francesca being there. And we also give bonus and motivation things for our brand ambassadors to keep like doing what they're doing. So that structure does make sense for us. And we keep repeating and that has been, think, the magic driver for us in terms of what we did in New York. So we want to repeat that in our stuff, basically.
Yeah. The other thing I'm like really picking up on that I want our listeners to key in on is the word repeat, right? Yeah. What have you been able to repeat, right? It's not like, we went out and did a demo one time and then it worked really well and then the second time it didn't, right? And if it didn't, what didn't work about it, right? Was it the wrong store? Was it the wrong time? Was it the wrong person? Whatever it was. The gathering of the data and then going, this thing, if I keep on doing it, will create
this positive result. I don't think enough founders are utilizing the data. Number one, because they have that feeling, that urge that like, I got to go fast. I think there's a lot in the media and in today's culture that pushes that. We're sort of the opposite, which is why I love your story so much. But I think thinking about how can I collect the data, taking the time to actually analyze and understand it then see if it is repeatable is…
is just clutch no matter what kind of business you're running.
Yeah, but I think the only flip side, of course, to the point that you mentioned, I think there's a lot of CPG culture around us that folks about like, we are in like, 4000 doors, 3000 doors, 1000 doors. we rather have, and Hassan and I talk about this all the time, we rather have 100 stores that is selling like crazy, because that's when you create a certain, I would say, a momentum.
against your brand and people be like, this is fantastic. Have you eaten this? Like people start talking about it. So that's what we're focusing mostly. Of course, it takes us away from that game, right? It takes us away from like, are you guys national? Like, no, I'm not going to be national. Like, it's going to be second year of my business. I'm not national. But when you look into a lot of brands journeys, like making that decision is tougher as a founder, like
We're nine months old. We're in New York City as of we're going to be a year old. think we're going to be in like four, five states. So coming in around like September, October, that's the growth pipeline that we have, but that's going to be it. And I'm going to sit on them and then make every state work in of itself to understand the dynamics. And then maybe we try something else.
Okay.
Yeah, I love it. So it sounds like you have a growth strategy that is not a quote unquote national growth strategy. It seems like a very strategic and I'm sure you've done your homework and market research on choosing which states and specific locations you go to.
Yeah, I think like there are a few ones that we think would be like very similar to New York or like similarish stuff gonna give us the same, I would say based off we're working with stuff is one of them obviously, a lot of foodie culture there a lot of international audience there like that would be great. I'm very excited for DC similar, like very much international very much aware of like
Little Sesame has a store in like these. So like those things are I think for us, it's like good signs. Yeah. If you want to do LA, LA is very open for a lot of like new brands coming in. But unconventionally, we're doing Ohio and Texas. Ohio is our suburban test. So we're going to launch the two regional natural grocery stores there. That's going to give us an understanding of how Bessie in of itself works there.
Like how does people take that? Like people do love it. Like how is the repeat purchasing dynamic there before we do everything about something national. So Ohio is that test and also Texas is that test. So we were very purposeful about what we select. then again, collect a lot of data on measures, see how much we sell and then repeat.
I just love this strategy. I want to check in with you quarterly. What are you learning? How's it going?
It is, it is like I mean, I love my side, obviously. But it is is tough and it is bold. So like, I do go through a lot of conversations with people who are like willing to invest in Buzzy or like any sort of like, you're the odd one out, right? Yeah, taking the business very slow. So I've been asked, like, how many people are you hiring? Like, I'm not hiring anyone, because I can run the business in this small constraint matter. Again, cash flow like
I can run the business this way and learn so much or they're like, you guys are not national yet? Like, no, we're not national. So it is challenging to be, think, on this side. So I hope it works. But we're very new, but very much opinionated on how we want to build the category.
Yeah. So oftentimes when people have, when founders have a growth strategy, I love when you're sort of, when a founder can sit across from me on the camera and say, this is where we are today. This is where we plan to be in six months. This is where we plan to be in a year. And these are the benchmarks that we need or want to hit in order to move to that phase. And we had a beverage founder on, gosh, it might be two years ago now because time is flying by. But he talked about
the progressions that his product would go through to basically improve the margin and enable him to go, let's say, into distributor, as opposed to what the margins would be when he was in Wholesale Direct. Seeing as though you have a factory that you're associated with, is there savings, potential savings, potential cost reductions that you would see with scale? Okay. I think this is really interesting.
Yeah, so we don't have that, right? I'm sitting on scale, but I'm sitting on additional logistics of the product coming from Turkey and additional like tax and tariffs. That's what I sit on. But I think what is a little blessing in disguise of building the category is the price comparison game is not that harsh. If you were doing yogurt, everyone knows how much a Chobani yogurt costs. And even though you might come with like a very healthy, amazing, beautiful yogurt,
your price comparison will be very much set in people's minds that you need to fight that. Labneh has a little bit more of a relaxed understanding in customers' minds because there is not a clear anchor. We might be anchored to a hummus. We're kind of sitting closer to like a fancy hummus, right? Where like $6.49 is I think our average retail price. Of course, it changes from one retail to another.
649 is very much comparable with let's say, little sesame hummus, which is like a fantastic clean good for your hummus. So we kind of like in the aisle kind of doesn't pop up in like a tremendously bad way. But of course, in terms of our like journey of it, our cost is only going to improve if we bring the production here, but that can only be possible if we have like the right strategic partner to be able to do that. Because there is not like you can't
We have our own recipe. We need to buy your capex. We need to bring the same machines here to build that. can't be done from a, like the run of the mill yogurt guy in upstate New York won't be able to do that. Right. Yeah.
Okay, so one more question I have for you is sort of around your customer. A lot of good food brands, as we call them, are introducing something new to consumers. You are introducing something new to a lot of people, and as you've said, it's sort of not your traditional. And so in my mind, it's almost like you're…
Yeah.
you've got two battles. One is you're introducing this product to people like, okay, I'm just going to say like a girl from Scranton, Pennsylvania who didn't eat it when she was growing up, right? And then you're also introducing it to people who might know about it from their childhood, but this is a different take on it. And so do you find that communication or helping people to understand the product is a challenge or an opportunity for you guys?
It is a challenge and opportunity at the same time because I think so when it comes to like the Middle Eastern Labneh, we are a Turkish Labneh base. So meaning that like there is Lebanese Labneh and Turkish Labneh. Lebanese Labneh is close to a strained yogurt, it's tangy. Okay. Turkish Labneh is more like sweet, not tangy in between like a yogurt and a cream cheese. That's what they sit on. Of course, the ingredients of it, the consistency of it is meant to be a
clean label spreadable product or dippable product. That structure does not exist in Turkey, but bezi plain is not that far off from a Turkish labneh. So here, I mean, there's like a one New York Times recipe, I'm blanking on the chef's name, that does this like a zaatar labneh pasta. So he uses a Turkish ethnic labneh. So that labneh and bezi are very similar. So it's not that off in the world of like Middle Eastern. However,
us changing the product into like doing everything and red pepper within that community assumes that we're almost gentrifying a category that was in but I think their perspective kind of changes when it's like a Turkish girl doing it like I grew up with this so I can claim the product and so that I think has been like some of those maybe like initial reactions you have for that community who grew up with Labneh and be like what is everything Labneh we did not have this
like back home, like who makes these things up? And I'm like, I'm Turkish, I eat this product, I make it up because it actually introduces and makes it more approachable for this group of people that I think should absolutely eat it. And it's good for you, no seed oils, high protein, da da da, all of that. So I think that is the reaction on the extreme side of what we do in the world of like Labneh. When it comes to more of like the audience here who never had Labneh before.
or benefit is the current environment is helping us introduce Labneh. So in New York City, you go to an American restaurant, you see Labneh in the menu now, which is fantastic. Like, Weirillion has two Labneh in the menu, one in the brunch menu, one in the dinner menu. You go into one White Street, which is like a Tribeca restaurant, there's Labneh in their dessert menu that they put like a ball of Labneh on top of something. So
There is an undergoing dynamic. And when you look at the data, Labneh has been Googled twice more since 2022, or is this how the state's saying. So there is an underlying momentum that we're tanked out sitting on it, because this is not something that we would be able to do it from scratch. Engage users are interested in Labneh. And I think our biggest enabler is that the profiles are very, like everything, yogurt, whatever thing exists in Trader Joe's.
So everything Labneh is the best seller. Why? Because it's a very familiar product in terms of the taste profile and we're going to do the same in hot honey. And that is the thing that we're doing to introduce ourselves into the customer looking at the aisle if they're not there to have them tasted. But of course, always a challenge. But that's why I think we're going slow. We're trying to give us time. We're trying to give the business time and be very patient as this category grows.
like good science for us. Trader Joe's just launched a roasted tomato Labneh just two weeks ago. Yeah. And they came to our booth actually at expo. We're launching Labneh. And we're like, great. And they're like, yours is great. We can't do yours. I'm like, exactly. can't do yours. But you can do whatever you want to do. But it is great.
Obviously, can't like there. think they market with $3.79. Like, that's a ridiculous cost. And when you look into ingredients, it's not as clean as Bessie, obviously. But we see it not as competition, but as a great sign that someone else is putting love now out there into Trader Joe's customers. And eventually, I know that awareness will build and it'll be benefit for us.
I love it. I that's amazing. You also mentioned in our questionnaire that you haven't raised funds, but also you've shared here that people have approached you and been like, do you want to go national? Are you going national? Why aren't you national? Who are you hiring? I'm curious. I never say never, obviously, right? But is doing a raise something that you could see in the future for Bezi or no?
Yeah, I think so. This is our approach. And I think this would go like a lot like similar to dating, right? If you're really looking to find a husband and get desperate for it, you're not going to get the right of it, you know, like that. That is, think, very similar to I think investing. So we want to build a business that we can stay afloat ourselves and really put a lot of energy in that assume.
We don't have money in the cash because we were lucky we have some seed committed from the family company. So that gives us some buffer to fly, but it's not what is going to take us national. Right. Absolutely not. But we're also not depending on that money and assuming, we have like 12 months of run rate, meaning 12 months lights off. That's not how we're thinking about it at all. But if you want to do the lab in a category in a bigger way that is national.
the numbers show even like for what these national channels want, right? You need to do a race. But we don't want to anchor our business plan on if that makes sense. Yeah. And really look for the right fit out there and have a lot of conversation so they understand what we're doing because we're not necessarily like a VC friendly brand based on how I want to grow my business. Like I'm not going fast, try to convince me going fast. I'm not going to like that's
Yeah.
So that is, I think the challenge when it comes to, we're not a good fit for that, right? They, course, invest a lot of money and believe in the team. They would want to see 10X results in the next five years. I'm saying I'm going to like go very slow and build velocity in the next five years. So that I think is like a challenging fit, but we have chatted with wonderful people and I think it's very humbling to have that attention.
But also we need to find the right fit because what we're doing is not not that it's like less of an easier job, but we're not doing like the new chocolate chip cookie. That is a different game. think that has very different dynamics. We're doing something that maybe 40 % of New York knows in a grocery store from demos, like 60 people of like 100 people that you taste don't know what labneh is. They taste it, they love it, they buy it. But yeah, so that's the challenge of what we're sitting on currently.
Yeah. mean, you know, the reality of VC funding is that they want to make money on their investment, right? Obviously. They're not doing it out of like the… Exactly. Yeah. It's not like, here, please, please take this money. It doesn't matter what happens. It's like, take this money and make me some money. And this is how you're going to do it. And I think, you know, we call people BABOYOTs around here, which stands for building a business on your own terms. I mean, just everything you're saying just like exudes that energy.
Charity.
And I'm just so happy that you agreed to come and talk because again, I love your product, but I also think that there's a lot that founders can maybe learn from you, but also I think know that they have like a sister in building a business on your own terms, right? And I'm like, okay, I know that I can say, no, I'm not going to do this thing because Ilay is in New York doing the same thing, standing her ground and building a
business the way that she does. Yeah. mean, I think the more like the real terms of that, like it's very tough to do what I do. And I'm sure it's very tough to do the other way. And this business is like so tough in general that like my background, not a lot of people know what this job is. So like I was there for like a Columbia Business School reunion and people were like, is this a full-time job? I'm like, like, there's nothing I do that doesn't work. Like there's nothing I do that I'm like,
thinking about that as a 24 seven. But that being said, like, we're trying something that what I understand from having conversation people are unconventional, but I'm not doing good because I wanted to be the unconventional founder that people talk about. But I cannot imagine anything else. Because I bought us on and I were at getter, right? Getter raised $2 billion. All right, it was a $12 billion valuation company. There was
no understanding of how much cash we burned. was like, because you if you raise 2 billion and the pressure with wonderful VCs, but they want returns. And if you do like a 2 billion investment, you want like a real IPO level return, you have to there's no other way. You get so much like pressure. And then we kind of saw what kind of pressure would lead to what kind of decisions. Yeah. And that I think money is very fickle. So you might be the king of the world one day.
And the next day you're like out and then you don't have the money anymore. So we had that experience at the other very clearly. We had so much money and the funding was gone. So we had, but I need to do like lay off my team twice. we would like, there were like a lot of things that we went through that were very cautious now, super cautious now, but of course. Like it's, it is one perspective. So if anyone wants to reach out to me and talk to me out of here, I haven't.
figured it out or exited or like sold the business or did well yet. Like none of, think a conventional success metric we hit. But what we hit is like the business is doing well. We're selling a lot. We're getting the right eyeballs. People love the product and we can grow organically. I think those are the successes that we got so far in like eight, nine months. And we got right retailers to believe in us, to give us the next opportunity, which we're going to like launch in September.
That is our success. anything beyond that, also say I have no idea. Just to put myself out there. It is better.
Yeah, well, here's what I'll say too is, mean, I don't know how frank I've been about this on the podcast, but I'm not one for exits. I want people to own businesses, not corporations, not conglomerates. think that especially here in the US, I don't know what it's like in other countries, but to have our entire food system owned by corporations is a scary thing for me to think about. So I understand
that exit is important for VC funded companies. understand that a lot of people, and it's their reality is that they're not making any money in the business until they exit. But my whole thing is like, what if we could build strategies where that doesn't need to be the outcome?
Yeah, it's fair. It's fair. It's I think but like in a very frank way, I think a lot of CPD founders do sacrifice a lot from their personal lives. Totally. And I think it comes from, I would say three prongs, right? It needs to hit, I think, ultimately, one is your self fulfillment, right? Like how happy you are building that. And I think you feel that from day one.
The second one is like because you build something I think everyone has ego right like your ego feels fulfilled You're like, okay There is a point why I did this right like I was happy to do during the journey and like this is the thing I built like everyone's eating it But I think as you spend more years at this job You kind of realize that you also need to make a living and I think that is for a lot of the emerging brands us included so tough because how the structure is like
Going into grocery stores, I know some grocery stores that we would love to be a part of. They have listing fees of $8,000. You know how much Labneh is $8,000? A lot of Labneh. Like I need to like, so I think that's why a lot of people, CPG founders think about exits in that way of like, we need to like, we need to live and make a living. I also would love to like make this business. So I think I respect for that reason Chobani so much because it's still.
Yeah.
Hamdi's business and Hamdi's built something so fantastic that it stands on its own, but also can acquire and grow. think that is so respectable. But I also understand from the other side, like some of these situations you need to maybe like find a way to make this more sustainable for yourself and the structure of the CPG currently and how much money has been asked from brands every day. Promotions comes from our budget.
Like the 50 sounds the customer gets because it's on market X. The market X doesn't get that. That's against that. Yeah, right over a pocket, literally paying it back to the grocery store. So I think those things are very real. I don't know. I see your
They're totally real. I'm a CFO for food brands. I'm living in those numbers. We just did an episode on what is it really like to launch with KeHE? From $68,000 in invoices down to a $13,000 payment from them. That's massive. But I still believe
Yeah.
I did that model too.
I'm sure you've seen a lot.
And listen, I'm still figuring it out too, right? How do we build strategies and business models where people can succeed and if they want to sell, sell, but like doesn't have to be the goal. That's fair. It's not like you're saying like the business model and the cashflow model is not in 12 months we're running out of cash so we need VC, right? We're going to try to do this and be cashflow positive on our own.
the right people come and when we're ready to expand, can have those conversations. I think that that's a great way to approach business as opposed to I'm going to launch this thing and then in five years I'm going to exit.
I completely agree with you on that.
come from a sustainable food space as well. There's a lot sprinkled into how I think about the food industry, but I want people to make money while they own their businesses. Listen, the industry has to change. I don't know if it will change enough in my lifetime, but I will do whatever I can to push it.
That's fair. It's infrastructure and I think US is too big for any brand to have access to that infrastructure without. like UNFI's and KeHE's have that. And there is no way, yeah, there's no way, like maybe for the world of Chobani is different now. Maybe Chobani has that access, but like there is no way. And I think because of the industry structure this way, like you think you're...
I mean, maybe not, this is not the case for Whole Foods, right? But like even the planet ground wars is a thing. think you have a good place and then next day you come, someone push your product on the side. like, so the industry, think is very harsh. I wish it changed, but it is, think, fascinating how many people would want to do this business and build innovation and keep growing. Like there is, I think a lot of people are looking to like innovate on the beverage space, the snack space, this and that.
But when you look into the real conditions of the business, which I'm learning in like, just eight, nine months that we've been operation, I think it's so tough. Yeah, so tough. And then the revenue is so small, like per unit revenue is so small, worse is if you were in tech or B2B, like per unit revenue is like, I don't know, like you put 5,000 Labneh in your first sales. For me, it's like 5,000 Labneh.
Yeah. There's no such thing as real scale. There's no such thing as scale in food, right? That's another message I try to get out to people like, in tech, you can do something, right? It's done. And then a thousand people could buy it then a million people could buy it and it's basically the same inputs, right? That does not exist in food, especially when you start talking about promo and distribution and all of those new costs that come into it. I'm just, again, I'm thankful for your time today, your insights, your opinions, your…
to business and your willingness to share that with us. Before we officially sign off, there anything else you want to share with the founders who are listening?
think I would just model everything. I am a huge component of modeling and seeing what it would look like. And some of those things that I think people get really excited when you put the numbers ridiculous. And once it's ridiculous, it's not worth doing it. And this I think applies to distributive contracts, like models like KeHE modeling, right? Like it is, some things feels so exciting when you're in it.
And so exciting when a person gives validation on your baby. But sometimes the validation means you're going to be stressed and losing a lot of money. And then it's going to maybe spiral your business. I would suggest modeling. That's, think, the biggest traps that I think if you get too cocky, I think that's how you go bankrupt. One of the reasons why you would go bankrupt. A lot of other reasons out there, but that's what I would say as my last comment.
I think that's great advice. Where can people find your brand and your product?
So you guys can give us a follow at EatBezi on Instagram and BeziLove now on TikTok. And when you go into Instagram, you will see a store locator there. So if you put your zip code, you'll see where you can pick Bezi.
I know I'll be picking up more soon wherever I go. Thank you so much Ilay. Of course. Have a great day.
You too. Bye bye.
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