From Home Kitchen Side Hustle To Multi-Million $$ Enterprise

Issue #47

March 12th, 2024

Quick Hits:

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🐦 A fine dining, uber riding, potty trained pet pigeon

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🐱 These are the 10 most popular cat breeds

One of the things we love doing at The Woof is uncovering the stories behind the brands you see and use every day. Every company has a founder with an inspiring story and a challenging journey. Before they became the success that they are today, they were unknowns trying to build a meaningful business.

Marie Moody, the founder & president of Stella & Chewy’s is no exception. For those unfamiliar with the company, Stella & Chewy's manufactures frozen and freeze-dried raw food and treats for dogs and cats.

In 2002, Marie lost her job in the fashion industry - it was her third straight fashion industry job that she had been fired from. But just like any scrappy entrepreneur, she was able to turn a negative into a positive and made lemonade from, well… raw meat and vegetables.

How it started: Chewy, her adopted dog was not in good health - the vet suggested she put Chewy on a diet of homemade raw meats and vegetables. She began preparing fresh, unprocessed raw meats, fruits, and vegetables, intended to be closer to the dog’s ancestral fare. To her surprise, Chewy started to feel better, much better, like 100% better (Chewy ended up living until the age of 17). This revelation took her down a rabbit hole. She did some research, and the more she learned the more convinced she was that high-quality food for dogs could be a lifesaver. She understood that more people would be inclined to feed their dogs this diet if only they knew about it, and its benefits.

She emptied her savings account, bought all the fresh meat, fruits, and vegetables she could afford, and packed her small NYC apartment with industrial freezers to store all of the food she was making. Her two rescue pups Stella & Chewy become taste testers and ultimately the name of the company.

In 2003, convincing stores and consumers to purchase a premium product like hers wasn’t easy. Raw was not trending yet and was generally thought of as inedible (luckily times have changed). Many stores told her they weren’t interested in carrying it.

One of the main reasons was that they just didn’t have freezers. Out of the 250 pet stores in Manhattan at the time, only 2 had freezers. 

Luckily, one of the 2 stores was in her neighborhood. She went over and spoke to the owner, he carefully listened to her pitch and then responded with a resounding “no”. He said, “I have a fridge full of this stuff that no one is buying.”

Marie used her 10 years of sales experience in fashion and said ”I’ll give you this product for free, you can give it out to people, if no one wants it, call me, and I’ll come back to pick it up”

A few days later Neil (the store owner) calls her and says “I want to place an order for 4 cases.” Marie was ecstatic, that was her first order and a confirmation that people were interested in her product.

She decided that a lack of freezers in the other 248 stores wouldn’t deter her. So she got a $50,000 loan from her father, went out, and bought a bunch of ice cream freezers. She was so confident that this was a great product, that she offered stores the freezers for free if they carried her dog food.

Initially, she sourced, made, stored, and delivered to each store. She would carry large boxes that barely fit in taxis (that were actively trying to avoid her). Her strategy at the time was to stash the boxes on the sidewalk, hail the taxi, then run back, load them up, and hit the locations she needed. If you know taxis in NYC, you know they must have hated this.

Not an overnight success: For the next 4 years she kept those freezers in her living room, as she clawed her way up the pet food success chain. She bought a van, a big upgrade from using taxis & the subway. However, her NYC apartment could no longer support her growing organization. She found a co-packer and outsourced her manufacturing.

However, co-packers, even with the best intentions can be a logistical and manufacturing nightmare. The lack of control over the process bothered her. She would frequently run into problems like:

• Old equipment breaking down

• Limited capacity on flavors

• Meat and organic produce sourcing issues

• Problems with transparency

And the list of problems went on…

She realized that if she wanted to grow the business, she needed to figure out the manufacturing piece of it. In 2007, Marie decided to relocate her family to Wisconsin and open a manufacturing facility there. She had no previous experience in manufacturing but she was humble and smart enough to find people with the right expertise to help her.

Once there, she worked with leading food safety scientists, to develop an exclusive, patent-pending, food safety procedure called Hydrostatic High-Pressure Process (HPP). HPP kills pathogens, such as E. coli and salmonella, using high pressure without diminishing the health benefits of raw ingredients.

The company was growing, it had expanded its distribution and was getting nationwide recognition but still had one major problem…

The company was not profitable!

Marie recounts this period as being some of her darkest times running the company, she was in constant stress as the bills racked up. Regardless of how tough it got, Marie always believed success (and profitability) was around the corner. She pleaded with the bank for a $100k loan, which they approved. This was ultimately one of the things that helped them achieve their goals at the time.

In 2010 she decided to step down as CEO of her own company, although she remained chairwoman. She wanted to do what was best for the company but also, she wanted to spend more time with her family.

The next 10 years:

• In 2013 Stella & Chewy’s was acquired by private equity group Stripes

• In 2017 Marc Hill was appointed as CEO.

• In 2019, 16 years after the company was founded, Stella & Chewy’s was in over 5000 stores nationwide.

• In 2021 The raw pet food company’s annual revenue reached US$52,400,000.

• In 2021 it invested $67.7 million to expand its facility in Oak Creek Wisconsin.

• In 2023, Stella & Chewy’s began selling its products in Petco’s brick-and-mortar locations and through its website.

Currently:

The company employs nearly 800 employees globally. Around 600 of those are in the company’s Wisconsin manufacturing site.

In recent years, the company has struggled with employee retention, so last year Stella & Chewy’s announced the “Stay Plan” to boost retention. Offering $15,000 bonuses if the site’s overall voluntary turnover rate drops below 23% in three years. All manufacturing employees at the Wisconsin site, at the end of three years, are eligible for the bonus.

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How to build valuable connections in the pet space

While unique in some ways, the pet industry is still a regular business sector and not that different from any other business sector when it comes to networking.

Attend industry & local events - Attending trade shows, conferences, and industry events offers amazing networking opportunities. While daunting initially, these events can be a great place to engage in meaningful conversations and meet like-minded professionals. Research local networking groups and make attending these events a regular practice. Proactively introduce yourself, exchange contact information, and follow up to cultivate lasting relationships. If you can’t find such events in your area, you can always create one yourself via Meetup, FB groups, etc…

Social media - It’s 2024, social media is the most obvious yet sometimes misunderstood medium. While the goal for everyone seems to be turning attention into action (which it absolutely should be) do not forget to use the social part of social media. DM others in your niche, comment on relevant posts, follow relevant people, and create content that will attract the type of followers you want to have. You may have heard this before but most of the magic is in the DM’s.

Join pet industry associations - Pet industry associations provide networking opportunities. Becoming a member of these associations allows you to connect with peers who share your interests and gain access to valuable industry resources, updates, and gatherings. Engage actively in association activities, share your knowledge, and explore mentorship possibilities to foster significant and hopefully long-lasting connections.

Online communities - Slack channels, subreddits, telegram communities, X, Whatsapp, Facebook groups, must we go on? Involve yourself in relevant online communities, not only is it beneficial for networking, but it’s also a great place to collect data and be inspired by new ideas. Make sure to regularly contribute, you never know, the people in that community could end up being some of your earliest & biggest supporters.

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Finally, What do you call a futuristic dog?

A howlogram.

See you Thursday!