BABOYOT with Shelley Elkovich of For Bitter For Worse: Patience, Pivots, and Path to Profitability
(Listen on Apple or Spotify. Full transcript below.)
Sarah sits down with Shelley Elkovich, co-founder and CEO of For Bitter For Worse, to explore the financial strategy behind building a profitable specialty beverage brand.
Shelley shares how self-manufacturing became a dual revenue stream through contract manufacturing, allowing her to control costs while generating additional income.
The conversation reveals practical insights on sustainable growth versus rapid expansion, how to filter customer feedback without compromising your vision, and the strategic decisions that kept this non-alcoholic cocktail brand resilient through major market shifts. Discover how Shelley evaluates each growth opportunity and makes decisions that prioritize long-term sustainability over short-term wins.
Shelley also graciously offered our listeners 20% off their products using the code Sarah20 on their website!
Connect with Shelley:
Website: For Bitter For Worse
Instagram: @forbitterforworse
LinkedIn: Shelley Elkovich
Amazon: Shop For Bitter For Worse
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Episode Timeline
00:00 Podcast Announcement and Personal Reflection
06:00 Member Highlight: 1111 Wellness Bakery
07:45 Interview with Shelly Elkovic: The Journey of For Bitter For Worse
13:35 The Evolution of a Beverage Brand
20:02 Understanding the Customer and Market Dynamics
26:21 Navigating Challenges in Launching a New Product
28:25 Navigating Change in Business Strategy
31:37 Relocation and Growth Opportunities
35:46 In-House Manufacturing vs. Outsourcing
39:34 Balancing Feedback and Vision
45:49 Patience and Learning in Entrepreneurship
52:59 Positioning in the Market
Full Episode Transcript
You're listening to the Good Food CFO podcast. I'm your host, Sarah Delevan. And with us as always is our producer, Chelsea Stier.
Hey, Sarah.
Hey, Chelsea. So Chelsea, we have an awesome BABOYOT episode today and a member highlight as, as usual, but we also have a really important announcement that I want to jump right into. I'm going to preface this by saying, I hope not to cry, but I make no promises. At the end of this season 16, the podcast will be taking a pause. We are going to call it an indefinite pause only because we don't have a clear date on when the pause will end. But the intention is for us to come back. I love making this podcast. I believe you love making this podcast. We believe that it's important for the successful change that we want to see in our food industry and for the success of good food businesses. But
Life circumstances have caused me to make some decisions that I did not think that I would be facing this year. My personal life is very private. I don't share about it on social media. I don't talk about it here, but I do want to share that someone I love very much, my dad, became ill in October and passed on November 14th. I made the very easy decision to leave LA and come to Pennsylvania.
because I wanted to be with both my mom and my dad, my older brother who lives here as well when a diagnosis came through. So I've been in Pennsylvania since late October and made the very easy decision of focusing my time on him and being with my family. As a result of that decision, together, know, Chelsea elected to cancel any podcast recordings that we had.
in the month of November that would set us up for season 17, which was set to launch in the new year. We also lost some ground on the software launch and the rebranding launch. And I want to take a moment to say thank you to our partners in those projects for being so understanding and for all of their kindness through this process. As we...
meaning myself and my husband look to return to Los Angeles in the next few weeks. And we look to the new year. I've had to evaluate priorities. Number one, being emotional, physical and mental health after being away for so long and travel and all of that. And it's the passing of loved one. That's our number one priority. After that comes our CFO clients who've also been so kind and understanding over the last month.
and the successful launch of the software that we've committed so much time, energy and money into. There's simply not enough bandwidth to do those things well and try to catch up on a season of the podcast that has gotten behind schedule at this point. So we've made the difficult decision or should I say the decision that doesn't come lightly.
Yeah
to pause the podcast, to make sure that we're doing the best that we possibly can with our top priorities. And then we'll evaluate when the right time is to bring the podcast back, you know, and what that looks like, because we don't know if it will look exactly the same, if we'll be here together. And that's sad and a little scary. And it comes with a lot of emotion, but it is the right thing to do for right now.
Absolutely. And Sarah, just want to say that I think I speak for everyone in the audience when I say that we love you and we want nothing but, you know, good health for you, as you said. So I think everyone will understand where we're at and why this decision is being made. And, know, I would remind everyone listening also that we do have one hundred and sixty three episodes. So there's plenty to go back and listen to if you.
Haven't listened to every episode since the beginning and to hear all of the good stuff that you have made over the years. You know, I'm hoping for a very happy, healthy and calm new year for you and for us. And as you said, it's a little emotional, obviously, but we'll get through this and see what the future brings us.
Yeah. And I do also want to take a moment to say thank you to our audience and to the podcast, think in general, because I think there was a version of me a couple of years ago who would have tried to do it all. Who would have said, I can't take a pause. And it would have looked really different, but I think, you know, it'd be remiss to not say that hearing from all the amazing Baba Yachts and founders on this podcast year over year, you know, you've all really helped me.
to come to a place where you could say everything will be okay when it launches, it launches and that's all right. And when the podcast comes back, comes back and that will also be okay. So thank you to the founders and the amazing individuals and our community who have just been a source of great inspiration for me over the past couple of weeks. We are excited.
Yeah.
to finish out the season with great conversations, really great guests. We're doing it happily and we're really excited for you to hear these final episodes of season 16. So with that, Chelsea, what do we have next?
So we're going to jump right into our member highlight as we've talked about here. And you know, the past few months is that this membership just continues to grow. We continue to see new founders joining us in the membership and in our live events and ask their questions. And it's been actually really, um, inspiring and fun to get together every month. And so today we are going to be highlighting Sussa Goins from 11 Eleven Wellness Bakery.
11 Eleven Wellness Bakery is an artisan gluten-free and grain-free bakery doing baked goods crafted with clean organic ingredients for wholesome indulgences. If you would like to learn more about 11eleven Bakery, can visit their website at 11elevenbakery.com. That's 1 1 E L E V E N bakery.com.
We love having Sussa in our community. She is what I would call an OG. She has been around a different iteration of the community several years ago and has just been growing her business. And we're so excited to be seeing her again more regularly as she thinks about what the future of her business looks like in the evolution of 11 Eleven Bakery. So thank you, Sussa, so much for your support and for doing what you do for the Good Food community.
Yeah. And Sarah, you teased at the top that we do have another great BABOYOT episode today. And this time you are speaking with Shelley Elkovich, the co-founder, CEO and self-proclaimed flavor maven of the non-alcoholic cocktail brand for bitter for worse.
I will go ahead and say that she is absolutely a flavor maven in my mind. I'm a huge fan of Shelley's and for bitter for worse, I am the happy recipient of a monthly subscription of their beverages. I love them so much. They're the winner of 21 international medals for superior taste and texture. So it's not just me, right? Like people who really know what they're talking about.
also agree that Shelley is a flavor maven and I love what she shares about her pastime and her hobbies that actually led her to developing these beverages. The company exists today to co-create a healthier, more inclusive culture. And if you're not on their mailing list, I highly recommend that you join because they know just that. They're not here just to make delicious cocktails.
Really, June?
They have a greater mission and it's a really wonderful thing to see and observe. I had the pleasure of working a little bit with Shelley's husband at the very early stages of their business pre-launch. He's an engineer, super smart guy, excellent at building spreadsheets. And I was that second set of eyes to just look over their, their forecasts and their models to make sure it all made sense for the CPG industry and to watch them and to, to buy from them today and be such a
you know, a proud customer of theirs is really such a fun thing. We talked with Shelley about their journey. So of course, like how they got started and where the flavors and her inspiration comes from. We also talked about how important it is to know your customer, not just who they are today, what they like today, but who your future customers.
could be and really getting to know them as well. found that part of our conversation to be super interesting as well as what Shelley shares about discerning between feedback to pay attention to and feedback to like acknowledge but not act on right away which I know is something that so many founders kind of struggle with for lack of a better term.
How to balance that. absolutely. thought that that was such an interesting part of the conversation. And you kind of mentioned it already, but another thing that I loved about this entire episode, I mean, the spanning the whole conversation, it was so clear to me how much Shelley does think about the future and how her vision connects to what the future holds.
And I think she's like really clear throughout the episode that like, nobody knows what the future holds and they learned that very early on in their business, but that she's always thinking about what it could mean. As you said, who those future customers could be, what those future flavors could be, what the future manufacturing could look like. mean, she's always thinking about these things in a way that I think is really,
forward thinking. mean, that's the best way.
Sometimes I notice with founders and I see it in Shelley, it's just a different energy around the vision of the company and the way that they strategically think. And I was just so fascinated and interested in learning more about that from her. And I think you also touch on something that is
important to highlight here is that when they launched, pretty much nothing went the way they thought it was going to, right? Like the plan that they had in their heads for how they were going to launch this thing, literally, like it could not be executed for reasons outside of their control. And I loved hearing the steps they took to figure it out, to pivot, to keep the business going and growing, even though it looked very different from what they thought it would.
And I think that's a huge lesson, you know, tough to learn right off the bat, but maybe also a blessing to have to learn right off the bat, right? So nothing in this industry goes as planned 100 % of the time. So I think there's just a lot of value for our listeners in hearing what it's like when you're faced with really big roadblocks that change the vision that you have for where you'll sell your product.
and who your customers will be and the pricing and just like you name it. have to kind of reconsider it.
Yeah, absolutely. All right, Sarah. Well, what do you say we take a break and then we'll jump right into the conversation.
Great idea. Let's do it. Over 70 % of early stage food brands fail due to cash flow issues, incorrect pricing and thin margins. The Good Food CFO breaks through that noise. Partnering with founders from pre-revenue through their first million in sales, we have created a first of its kind financial software that is designed to teach you to understand your numbers, price for profit and make confident financial decisions that support long term sustainability.
The Good Food CFO's proven framework is helping good food businesses thrive. Your business is next. For a limited time, you can head to the goodfoodcfo.com and join the wait list to receive 50 % off your first month's subscription. Now back to the show. Shelley, welcome to the podcast.
Thanks for having me, Sarah. It's so great to see you.
You as well. I want to share with our audience that I worked a tiny bit with your husband and I believe he's also your partner in this business in the very early like pre-launch days, I think of For Bitter for Worse. And it has been such a joy to watch your business grow and to be a subscriber because your beverages are amazing. I love having them delivered to my house every month.
Thank you.
I'm dying to hear from your perspective, you know, the history or sort of the background on For Bitter, For Worse. Where did the idea come from? What were your aspirations when you were getting started? Stuff like that.
Yeah, I mean, it's a wild journey and it starts with sort of a strange catalyzing incident. I mean, to start with, you know, my husband is my business partner and we, my gosh, we're coming up on 35 years of marriage.
Congrats!
Thank you. We met when we were in college. And so we had always made drinks together. You know, we were sort of like had a little bit of a Nick and Nora vibe. Our house was always the social hub and we went very deep with our experiments. You know, we made cider together after harvesting apples from abandoned orchards. Jeff made cluster select wine. I turned his wine into vermouth and liqueurs from the garden. Just like lots of big beverage passion. And I have training in herbs. So I used a lot of herbs.
And so you're hearing a decent amount of alcohol there. so then fast forward to 2018 when our last child graduated from college and we were kind of like, you know, looking at that next chapter and then the company where he had spent his career abruptly ceased business with very little notice. Yeah. So it was.
it was a big turning point for us and we're like, okay, let's take this as a sign to think about what we might do differently. And, you know, we were very passionate about beverage and very naive. And so we thought it would be fun to start a beverage company together. And because we are, you know, not independently wealthy folks, that meant we had to make some big changes. And so we rented out our home in Southern Oregon and house sat for a generous friend who had
a farmhouse on Shaw Island in the San Juan Islands in Washington state. Very remote, not even a grocery store. We had to take a ferry to go to the grocery store. And so this now I see as our pandemic training because we were kind of scared because we didn't know what we were going be doing with our lives and because we were very isolated. So we took six months doing a deep dive thinking about anything we might do to do with beverage and that, you know, we thought about ready to drink alcoholic cocktails because at that time there wasn't anything very good. We thought about bitters, we thought about mixers.
We really weren't sure. And then we took a whale watching trip while we were up there. Gorgeous day on the Salish sea with baby orcas. mean, spectacular. But I had this rare neurological reaction to the boat trip and hours later, I know I felt fine on the trip. I felt absolutely fine. And I grew up on a sailboat. So was very unexpected, but hours later, it's like I was drunk and I was falling, walking upstairs. yeah, it was very, very strange.
Yeah. So I was eventually diagnosed with this rare syndrome with a fancy French name, mal de debacle. And so I broke up with booze to protect my brain health. And that was the that was the catalyzing event really, because there was nothing that pleased my palate and also met my ingredients standards. I'm a very nerdy label reader and I like clean labels. So that was how we were served the idea that led to this completely different path in our lives, right? Livelihood and a crazy ride.
So weird story.
Yeah, that's amazing. I love learning about your passion for making beverages, know, like pre all of this. That's I mean, having tasted and I'm sure anyone listening who's had your cocktails like it makes sense because they're so unlike anything else I've ever had. And they're so I get the only word I can think of not being like a quote unquote beverage person is they're complex in the best possible way.
you
I mean, yeah, I think they're just so amazing. So how long from sort of the idea to actually creating the product?
Right, well we took about a year of iterating our formulas. You know, we left the San Juans, went back to our home in Southern Oregon and did lots and lots of pop-ups where we were giving away hundreds of drinks and meticulously recording people's feedback, friends helping us. You know, it was just like, was a crazy time. And Jeff is an MIT trained inventor. And so he took his like hacker mind, engineer mind,
and created our trade secret production process that we call reverse bootlegging. And so that's one of the ways that we get these really bold and complex flavors from organic botanicals is through this special process because we don't use off the shelf extracts or natural flavors or anything lab derived. We start with certified organic raw botanicals. And so it's a very different process. That's what you're tasting in these drinks. It's really exceptional ingredients and we have a different way of doing it. And so also, you know, I was...
but occasion a lot. And for me, it didn't really make sense to make a mimic. mean, there's a place for those drinks, you know, a non-alcoholic G and T or, you know, mimic. But for me, I wanted something that was going to stand up to your expectations. And so for me, that meant not looking at a complete analog or mimic, but thinking about occasion. So I thought about what do I want in golden hour? What do I want, you know,
on a lovely afternoon, what do I want instead of a glass of red wine? What do I want to drink when I'm craving a potent, you know, brown spirits cocktail? And so that's the template I use for coming up with what is now Four Expressions.
Yeah. And while you're in that year of developing and testing flavors and getting your formula down, are you also thinking about the brand and starting to strategize the name and the customer and all of that? Can you talk a little bit about that process?
Yeah, well, we actually came up with the name right away very early, even before we knew what we were going to make. It's a pun on the way for bitter for worse. And, you know, we've been married a long time. It's sort of been recognition of our sparky marriage and also the fact that I don't enjoy overly sweet, what I see is overly sweet cocktails. So I wanted something that was bitter for it. So the name came first.
Then, you know, then it was like, okay, this is the type of product and then it was layering in Yes, customer discovery, discovery, finding out what other people were also interested in drinking. But honestly, a lot of that was instinct and letting my my own palette and I thinking, okay, I'm the person I'm making this for. That doesn't mean total abstention. We know that most of our our consumers are most of our customers.
are moderating alcohol consumption, right? They're not necessarily staining. And I will, you know, I don't identify as sober because sobriety is a very long, hard-won process. I am somebody who doesn't really drink alcohol, but I do appreciate a talented bartender. And there are times when I'm well-fed and well-rested when I will have a gulch and have a drink. So yeah, you just took everything that I wanted.
and figured there are other people like me and there are and we know that our, you know, our target customers are women. I mean, it's like 25 to 65 ish, but then when you really drill down, we're talking about elder millennials, women in their forties, know, 35, 40 plus definitely a sweet spot. And one of the things that I have realized that is very interesting to me just as a feminist and a woman in midlife is that
A lot of what's driving the moderation has to do with sleep concerns and hormonal concerns. And so what I know, because I know my customers well, is that that is sort of the underlying issue for them, the quality of their sleep when they think about whether or when they'll drink alcohol.
Yeah, I will say like you're so spot on because I get up early. I like to get up early for a while. I was working out really early in the morning and I wanted the there's something about like for my husband and I'm the process of making dinner and having the beverage with that process, right? And I was not going to imbibe like
light beer to glass of wine to martini didn't matter. Like wasn't going to do it during the week if I was trying to get a solid seven to eight hours and be up at you know 445 in the morning. And so that's really when I was like okay what can I bring in that's going to taste really good. And obviously yours was one of the first that I tried so was so aware of the brand and I was just smitten you know from the beginning. But it's so true you know and you're also hitting I mean I'll just share that like
I'll typically have drinks on the weekend, but not during the week. Right. So that is like, yeah, sort of that moderation and also, but I think it's, it's so helpful for you to touch on that here because I think something that's so important, especially for premium brands and, many of the founders who listened to this podcast are founders of premium, you know, product brands. It's so important to know your customer. It's so important to be speaking to them because especially if you've got a premium price product, you need to know exactly who you're talking to and to really.
hit them. I also think it's really interesting to think about your channel strategy in addition to like who your customer is, right? And knowing it's all a part of that overall brand strategy. What were your thoughts like early on? You also mentioned that you were a bit naive. So I'm curious, like what did you think like the launch of your product would look like and the channels that you would sell in initially? And then I'm curious if that has panned out or if things have changed.
Yeah, well, I mean, I figured we would start with specialty retail with a local and regional focus followed by quick world domination. you know, wasn't so much that way. One of the things that happened is we launched six weeks before the pandemic before lockdown. So yeah, we had initial, I'm not going to go into that.
wow.
Sure.
backstory, but basically we were very widely enthusiastically accepted from the time we sold our very first bottle at a holiday craft show or holiday market in Portland. And so we had 28 tours, new seasons being a large chunk of that, ready to go on March 20th of 2020. That did not happen. Yeah.
completely through our pandemic pivot and focus on direct-to-consumer. And for us, know, like we didn't have a Shopify site yet. We didn't have a proper way to sell direct-to-consumer. So we built our Shopify site. We, you know, dug in on direct-to-consumer and needed to do that for quite a while. That is what helped us to learn so much about our customers. while it's
for an emerging brand, especially one that sells, at that time we were only selling in glass bottles. So, heavy glass bottles of liquid. It was expensive and it was difficult, but we learned so much along the way. And we did a really good job with, know, Gorilla PR. So we were able to get the word out. And as a result, our strategy was first B2C and then regional was out the window because West Coast sampling didn't come back until December of 2022. So we needed to be in Portland.
So we were sort of, we were using FAIR, that platform to just basically sell in small specialty retail stores wherever they would have us. know, there were other parts of the country that opened up much sooner. So we had this sort of scattershot national approach from the very beginning. I mean, it did, it did learn, you know, we learned a lot about where our best customers live and things like that. You know, so it was all learning, very different than what we anticipated. We were finally able to
shift to a primarily specialty retail focus and primarily West Coast at the end of December 2022, early 2023, but it took that long.
Wow, that's really fascinating. This is going to sound dumb, but I never really thought about like no demos, you know, and the impact of that on like from COVID, which is wild that I never really specifically thought about that until this moment went while you're sharing that. I especially as a brand new brand. Yeah. Wow. Yeah.
in a new category.
You know, demos are still really important. I mean, you know, they say sips to lips, right? Like that is when people try to it. But now at least the category is more mature and people understand what it is. Back then, you know, we're talking about really non-alcoholic cocktails. What is that? So to not be able to demo was just... First of all, we didn't even get on the shelf because of that. They were smart enough to know, you know,
Yes.
Yeah.
Yeah.
seasons that it doesn't make sense to watch until then.
Yeah. So if I might, from a financial perspective, what were sort of the impacts or were there any kind of changes you had to make going from what you thought was going to be a regional launch, right, in a well-known and popular regional grocery store to now this online and then, you know, shipping on fare. Maybe this was at the time where they were kind of covering shipping costs. Maybe you were paying for the shipping costs like
Basically, the finances around your strategy were different. Did you have to adjust where you like, we're just going to stick with it? What can you talk a little bit about that?
Yeah, it was, was very challenging. I mean, one of the things is that at least early on social media ads then was still efficient. As you know, you know, I mean, I understand and value privacy and it's very different world when you're trying to, you know, Instagram ad than it was back then. So we have that in our favor. Social media spend was quite efficient. We also.
Yeah.
It's a-
recognized pretty quickly that the entire, the world had changed, right? Like when we were thinking about launching our brand in 2019, the idea was that, you know, you're looking at top line growth, you're looking at big investments, you're, moving fast. We understood very early that we needed to be the tortoise rather than the hare, that we needed to look at economic stability and that path to profitability and much slower growth.
So that was probably the biggest thing. You know, it's, kind of fun now to see that our strategy is now widely accepted and applauded when at the time it felt, it felt very much like, you know, we were the, I don't know, the poor cousin or something trying to was so little, but we learned to you know, very scrappy and capital efficient. And I think those are the things that, that serve us to the best because the world is different than it was and you know, the entire investment.
it was different than it was.
Yeah, yeah, that's super interesting. I'm glad that you recognize that really quickly as I as I kind of mentioned at the beginning of the episode You know, spent just a bit of time with your husband but he had or you you know that you as a team had really thorough Financial models built and he was just coming to me to say hey, is there anything missing from here anything? I didn't consider and so knowing how well thought out everything was going into it It's really interesting and kind of not surprising
to hear you say, we adjusted, right? And we kind of knew what we had to do from understanding how things were changing. Super interesting.
Well, that foundational time with you is really important because in addition to just modeling, I mean, you had the food and beverage experience and you had the insights into the industry that was really important. mean, yeah. So Jeff, because he was a hydrogeologist and did all the, you know, he spreadsheets and he knows modeling, but this was a different of modeling. And yes, projections and modeling are still a huge part of what he does.
Yeah. It's hard to be the creative mind, you know, creating these amazing beverages and, and really you're like the face and the, it's such a huge part of the brand. feel like too, it's very, you know, dialed in and I just love getting your, your emails and everything. So you launched a bit different than, than what you had expected.
You took a slower, as you called it, tortoise in the hair, know, kind of path to growing. You recently had a big change. You mentioned Portland and Washington. You're in Rochester now, and I'd love for you to share a little bit of some of the exciting things you've got going on and maybe if that will lead to world domination, you know, anytime in the near future.
Yeah, so we're, by Coastal Company now. We have a small team and warehouse in Portland, but we did relocate to upstate New York this summer. So it's all very fresh. We only been here a few months. Um, we, so there are a couple.
You know, there's always multiple threads to any story, right? And the first one is personal in that our daughter lives in New York City and as she matures in her life and is, you know, looking at, you know, marriage and starting a family and that kind of stuff, we knew that we wanted to be closer to her. And so we figured that at some point in the next few years, we would end up in New York state.
probably not New York City, right? But somewhere around there. And the team from Grow New York, which is an investment competition, reached out to me when I was at a food event in Chicago. And this was, let's just say it was 2023, somewhere around then. And they talked about, they told me about the contest and it's an investment contest for innovating.
food, beverage and agriculture brands. And there was very little time to, think I had six weeks or something to put together an application, which is ridiculous. But I did it and it's an amazing program and they give you feedback at the end. And of course I was not a finalist. I didn't have my ducks in a row in any way. But one of the things they said was, you're competitive, you could do this. You should try again next year. And so then we really looked at it.
Hey, let's look at this investment and let's think about what this might mean for us. And so then I really dug in, learned, networked, know, visited the region, got to know the right kind of mentors and put together a compelling pitch. And last year we were one of the winners. We were actually the first beverage company in history of the competition to win.
That's pretty Amazing! Congrats! Yeah!
Yeah, the so you know, we're talking today on November 6, the next week is the the Grow New York competition for the next round of finalists and I'll be there. it's exciting. So yeah, we got that investment and we were interested in New York State because you know, it is a food and finance capital of the United States, there's a lot going on and because we could be closer to our daughter. So we were not required to relocate but
That investment plus some other investment enabled us to make that move. We settled on Rochester because it's really quite an interesting and attractive small size city. And it's got an airport to which. But it's yeah, it's really very lovely and they have a very strong manufacturing talent pool there. found a facility that is 4X our facility in Portland that we had really severely overgrown.
That's so funny.
you know, outgrown and it was nearly turnkey. It's an 1800s distillery, factory, patent medicine building from the beginning, but it also has, you know, a modern manufacturing part of that, that large building. So yeah, it was practically turnkey because it had been a vanilla extract manufacturer in most recent years. So we took the plunge and now we're bi-costal. I mean, I still love Portland so much. And as I said, we have.
the team there and we spend time there, but we are now making our product in upstate New York.
Wow, that's so exciting. Can we talk a little bit about the self manufacturing? Obviously, Jeff has created, invented, you know, the methods by which you're making your beverages. So I'm sure that that was a key component to maintaining the production in your own facility. I know a lot of people kind of think about, you know, should I outsource this? Should I do it? You know, should we do it in-house? You know, what are some of the...
challenges that you faced by keeping production in-house and what are some of the benefits?
So the benefits are that we really are controlling our destiny more. We are able to control quality. We're able to control our schedule. We're able to control our.
the size of our runs so we don't have to worry about a huge minimum order quantity for a contract manufacturer and we can also pump up production when we need. So that has been really good. And again, we have this proprietary process. We also are now contract manufacturing for other beverage companies. And so that's an exciting prospect that is also another source of revenue. And we started doing that in Portland. There's a huge unmet need.
for small scale, low MOQ beverage production. However, in Portland, despite so much demand, we were constrained. We were already maxed out in our facility and our team. So we did a little bit of it in Portland. Now we have a much larger capacity in Rochester. So we're ramping that up now. And that's very exciting. Challenges, I mean, yeah, when you're talking about equipment in full scale, that's a whole different ball game.
to be completely transparent. That's where we're letting the market tell us in the next couple of years what our direction will be. Right now, we self-manufacture, we use a mobile canner. We're able to keep our equipment costs pretty low. However, we also know that we can protect our trade secret and have our product contracted out when we fully sell.
around the time of a series A and around the time of the next big growth in a couple of years, that would be a big decision point for us. Do we continue to contract manufacture and self manufacture at scale or do we have our product manufactured for us? Time will tell. We have optionality. That's the good, right? We can see how it goes.
Yeah.
And as someone who's just a huge proponent of local and regional food and the ability for smaller brands to be able to create their products without such high MLQs and things like that, I'm very grateful for facilities like yours that make that available to other brands. It's really great.
Yeah, thanks. It's exciting. It's a whole other thing. And you know, it's also not too much dilution in terms of the company because we are two founders with very different responsibilities and skill set. You know, Jeff is operations and manufacturing and so he handles the contract manufacturing. That said, I do get involved in some cases with formula development for companies depending.
Yeah.
Yeah, there's a couple of things I kind of want to touch on here. One is I want to go back because I wanted to mention this earlier and then I skipped to another topic, but the feedback process because you had mentioned early days while you were formulating, you were really following your instincts, your palette, what you liked, but you also mentioned that you meticulously got feedback. I have learned through the process that I'm going through now with developing our software.
that there's literally nothing better than feedback. And you can have your vision and it's still very much your vision, but nothing can replace hearing from people how they're taking in this thing that you've created. So I wonder if you can speak a little bit to the balance in that process for you. If you can remember back to that, like how do you stay true to your vision while hearing people, you know, and deciding whether to...
change something or not.
Yeah, well, you know, and beverage and a palette is so personal, right? Like there's something for everyone. But I do kind of believe that if you're pleasing everyone, haven't made anything that's all that special. It's not really possible.
Yeah.
everyone. As a concrete example, smoky number 56 is our potent smoky spirit alternative. It's not a you know, whiskey and air quotes or a mezcal and air quotes or a Scotch but it is a potent spirit alternative. And it's our most polarizing. Yeah. It's one that bartenders absolutely adore because it's so versatile and so bold and so complex.
But through these pop-ups where we're giving away hundreds and hundreds of drinks, it was very clear that the word smoky needed to be in the name so that people could self-select and enjoy smoky flavors. That was super important. know, didn't change our formulas very much with consumer feedback. We did some dilution, which might surprise people if they see how bold and...
robust our flavors already are, but they're even more concentrated cases. But there wasn't a lot of change. I one of the things I guess I will say is that in my case, that felt like a lot of affirmation. You know, get us get us and they love us and they love the ingredients. And so that is still where I'm trying to think how to say this. It's not like
I'm creating an echo chamber, but I see where we resonate. And that is what is important. There are going to be people who are like, this drink is not for me. And that's okay. You know, we want to try ways to communicate what our drink is, what our flavor profile is so that we're reaching the people that our drinks are for. And that's the most important. I mean, that said, you know, I'm always thinking about new
Yeah.
new ideas, new formulas, what would be a good offshoot, what might be like a little more approachable. And I will say Rose City Fizz, which is our newest expression and it's my love letter to Portland, which is the Rose City. Doesn't have roses in it. With berries, cherries, hibiscus, ginger, and then Douglas fur tips. That one I was thinking about approachability from the standpoint of being a little more fruit forward.
And, you know, what if I'm thinking about a customer who does not have a cocktail palette? And really quickly, I made this drink for our Muslim neighbors. They're friends who are Portland filmmakers, artists, like very chic people in their thirties who have never had alcohol, you know? And I want to make something for Wagamah and Ali. And so I did.
And there's nothing more fun than them sending us photos of where our drinks are being served at a party and they get to say, oh yeah, we were the inspiration for this. That's amazing. So we can think about other palettes and expanding our customer base in that way.
Hahaha.
Yeah, yeah. I think that's really helpful, you know, insight because I think it can be, I don't want to say easy, but there's fear, think, right? Especially in the early days when you're like, hey, you know, taste this, test this out. What do you think? And if someone says, oh, it's too strong or, I don't like it to say, okay, well, maybe you're just not our customer and that's okay. And kind of keep on going and not having a knee jerk reaction, you know, and having that commitment to, to your vision, I think is really important.
Yeah, it's a delicate balance. mean, I think it's definitely useful to have people who are not your friends and family, people who love you tasting it because you you have to wonder like, well, is everyone just gonna, they're not gonna say if they don't like it. I think I get maybe the key is numbers, like really getting out there, you know, so that if you're doing the same thing over and over again, like, this is terrible. I don't like this. You rethink it. I mean, in our case, like I said, with smoke weed, there were enough people that loved it that we stayed true to
to that vision. you know, we're not going to get into ski registration here now. Yeah.
That's all. Yeah, yeah. We had Smokey in our house and my husband liked it and I was like, that one's not for me. But I like the other three. Yeah, but I don't like Smokey things. But I was like, I'm going to try the whole array of flavors and see where I land. I also love, I mean, I could wax poetic about the flavors. I'm someone who loves bitter. I don't like sweet drinks at all. I think it's the Rose City that, as you said, it's a little bit
More delicate, a little bit of sweetness and then that the fur. It's just so like I said earlier so complex and so great so even if you do have a cocktail palette like that Rose City Fizz is so gonna get you in all the beautiful ways like I'm such a fan girl I take your cocktails to parties and like I'll hand them out to people or I'll like get like a you know a glass and I'll kind of give everybody a taste they try to turn people on to them
Especially if someone's not drinking or they're just having a water or like a soda. I'm like, I have something better for you.
thank you.
Thank you. The other thing I wanted to touch on was the idea of the vision and growth and kind of what you see for your business, something I was picking up on during the conversation, what it seems like is that you've got maybe not a crystal clear roadmap of this is going to happen on this particular date, but in how you're speaking, I get the sense that there is...
milestones, you've got milestones in your mind for what this brand will achieve, what you want it to achieve. And it still doesn't seem like you're rushing toward anything. It still seems like there might be some patience and like appropriate timing, if you will, in your mind that's kind of keeping you on track. Is that accurate?
Yes, and I think the patience has been something that is, I'm still developing. I'm not the most patient's person. Luckily, my co-founder is, but that's, you know.
part of being an entrepreneur is having this drive and it can be hard to be patient, but if there's anything that we've learned over the last five years, it's like, you don't know what's happening next and it's all gonna take its time. So yes, we have exit in mind, we're closing in on our path to in terms of scale and what that looks like.
That's where I said, you know, we're exercising optionality there. We're going to see, see what the next couple of years teach us. But, um, yeah, it's patience is required. And, know, I'm tired of saying that we live in unprecedented times, but that's really true. So there's no choice, but to just kind of keep going and. Faith.
Yeah, something I hear a lot of successful founders say is what we can learn, what this step will teach us, what this customer will teach us. Can you talk a little bit about in whatever way like feels appropriate, you know, to you, because we value, you know, privacy and confidentiality, but what are you hoping to learn or what are you, you know, what are the things at this stage in your business that you're
you're keeping an eye on that you're taking in and learning to be informed for the next steps. Because I think this is something that some founders don't do. They just are moving forward. And maybe that is a bit of a lack of patience or that not trusting that you can slow down and learn, you know, kind of before you move forward. So I'm just curious, what are you hoping to learn about?
one of the things that comes to mind immediately is the fact that the way that we socialize, and I'm just going to talk about this country, even though I have an eye on world domination, let's just talk about the United States. And the way we socialize is changing and is absolutely changing. is not, know, moderation and reduced alcohol consumption is not a fad. This is here to stay. And so when I think about
the future, I think about the future of drinking and the future of, you know, what our customers will be like and what their palates will be like. Right now, a lot of people are talking about Gen Z, of course. We know that they consume products like mine a bit less, they consume more sodas.
you know, things like that. And so I think about their palettes, and I think about their sophistication, and the ways they're going to change the market, because they will not necessarily have cocktail palettes, for example. Right. But it's a really exciting generation, because they are not binary thinkers, they're inherently flexible and fluid. They care.
a lot about what a company stands for, you know, and they're not going to be fooled by greenwashing or whatever other kind of washing you want to look at. So I think they're very exciting. And so that's one of the things I think about is like, okay, this younger generation as they mature and perhaps spend more and become more interested in this category or things that are less sweet, you know, what will they be attracted to? So that's one thing learning about Gen Z.
Yeah, so interesting. I'm just like capturing so much from from our conversation, you know, valuable insights that are that are broad, like paying attention to the broader market, right? Not just the people who are buying from you today, not just the potential retail customer per se, what they're going to do, but but who may become your customer in the future. Right. And again, this is this is
The kind of thinking I think that successful founders have, know, patience, looking beyond the walls of their own company, looking beyond the metrics of their existing consumer, thinking about that bigger picture. That's all really interesting things to think about. think a lot of people, including myself, can get very focused on what is directly in front them and not kind of step back and go, let's think about, you know,
to do.
more years down the road or how we can capture a wider audience and what that might look like. So it's really cool to hear you talk about that. Thank you. Anything else that you want to share about the journey of Forbidder for Worse? Any lessons you've learned over the years?
my gosh. When people tell you beverages are hard, they are right. It's, you know, I think it's also, it's been a little bit of a blessing to be an outsider in that way, to not have come from a beverage background because I see possibility and I...
Yeah.
I sort of attack this with the beginner's mind all the time, although I'm also learning all the time and certainly have more expertise. Like it's fun to be at the point where I can actually share my experience with others and mentor earlier stage founders instead of just being the sponge because I was the recipient of a lot of mentorship and kindness and generosity in those early years and early days that it's fun to be able to
pay that forward a little bit. Yeah, but I think the main thing is just being willing to stick with it and understanding that it's a rollercoaster. Like that is not gonna change. I was just talking with another founder friend in a different industry and he's like, know, those highs and lows every day, that just doesn't go away. I'm like, no, the stakes will change and the reasons why your experience, highs and lows will change.
I do think I'm more resilient now. think I used to take the lows a lot harder and it's easier for me to say, wow, this is where I'm at today. Something good is coming soon, but this is pretty rough. That's a big part of it.
Yeah, I just I thought of one more question if I might ask. You're a non alcoholic beverage that has a cocktail taste, which I just, you know, I'm thinking about where would you be positioned on the shelf? Right. So I know that you sell into more of like the boutique, like liquor stores, beverage stores, right. And you fall into obviously that non alcoholic cocktail category as you think about growing beyond that.
I think something that a lot of new products, even within an existing category, something that is a bit different. Where do you go on shelf and how do you find your customer in maybe a traditional grocery store? Or do you know that a traditional grocery store, I'm sort of making air quotes for people who can't see me, is not the place for you to be? How are you approaching that?
Well, I mean one of the things that we're seeing is that this category is being embraced Quite widely, know traditional grocery store even you know upscale CBS as well as obviously places like Whole Foods and so we're seeing this Tremendous Embrace and enthusiasm right now where most stores are carving out real space and curating sets and that's exciting. We're launching in Whole Foods
New York State this spring, although we have a January feature that we just learned about last week. So we're looking in all Whole Foods New York stores in January, and that is a So it's adult non-alcoholic beverages. They have a buyer that is exclusively for that category now. I mean, we're seeing the same thing at Wegmans. There's a category at Target. So it's becoming more and more mainstream.
That part of the work is easier. Merchants at all levels understand the value and the need to carry this category. Now the trick is differentiating and standing out on an increasingly crowded shelf.
Right. Well, Shelley, I'd love to, you know, kind of getting to know a little bit more of what's been happening behind the scenes and how you've grown. I think, I mean, I've had takeaways from this conversation and I hope that the founders listening have as well. just think your thoughtfulness, your patience, your willingness to get feedback are all like great examples of what it kind of takes to be in the founder seat and to...
Be resilient, right? And to kind of keep on ongoing. I think it's all really wonderful advice and examples for people. So thank you for taking time out of your, what I'm sure is a very busy week and very busy day to chat with me. I really appreciate it.
it's been a just a delight. Yeah, I mean, I just hope all the founders out there find their people and get their support so that they can continue to believe in themselves and and, you know, hang in there. It's not easy, but it is really rewarding. And it's special work. mean, founders know, right, we see each other and we just know. And if you know exactly what this person's life is like, and what the heck they are struggling with, and then special.
Yeah.
So for your listeners, do have a discount code, 20%, Sarah 20, if there are any founders or other listeners out there who would like to try our drinks.
Amazing. Well, thank you, Shelly. That is such a sweet gift. I highly recommend it. I'll take advantage of it. If you need flavor racks, I'm happy to help you with that because I'm an avid drinker of all of the flavors. So thank you again, Shelly. And please say hi to Jeff for me.
I sure will. Thanks, Sarah. Wanting to dive deeper into your financial strategy? Visit the goodfoodcfo.com to learn more about the Good Food CFO software. We'll be back with a brand new episode in two weeks.
This podcast is for entertainment and informational purposes only and is not intended to provide personalized financial, tax or legal advice. Every business is different, so please consult with qualified professionals about your specific business and financial situation. Any actions you take based on what you hear on this show are at your own risk.
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