Subscribe: Today we talk to Riana Lynn, Founder and CEO of Journey Foods. From her time working as a tech advisor on CNBC’s The Profit to her days as an ‘entrepreneur in residence’ at Google, to starting a juice company to running a logistics supply train transparency tool for the food industry, she has led quite an exciting career, filled with acquisitions and exits. Working with specific metrics and cutting-edge tools and technologies, Riana has been able to stay at the forefront of the food industry and is leading the next generation of food. As a serial entrepreneur, having sold multiple businesses, Riana finds joy helping others navigate their own exit journeys, understanding the nuances that are hard to learn from a book.
Bullish On E-Commerce
As the director of technology and growth for the CNBC show ‘The Profit’, Riana says she’s always been bullish on e-commerce, especially when it comes to food. Once she was scaling companies from a few hundred dollars a day to a deep five figures a day, she knew there was no going back. With a lot of problems in the food industry, especially in logistics, Riana decided to keep this her primary focus. About 75% of her investments were into food companies. One thing she was learning was that brick and mortar sucked; restaurants had low-profit margins after paying for employees and real estate cutting into 30-50% of revenue. This has led to an increased investment into ‘cloud kitchens’ which is essentially a commercial kitchen space that provides food businesses the facilities and services needed to prepare menu items for delivery and takeout. So in 2014, Riana dove into software as a service (SAS) and launched her third major company, Food Trace, a logistics supply train transparency tool. Operating Food Trace was an interesting learning experience for Riana. She says her work in SAS had her in rooms with people that had sold companies for nine figures. These companies didn’t care about press, tech crunch, or podcasts, they were more about industry authenticity. Then in 2017-2019 you started to hear more about blockchain in the food industry. As food is a pillar of human life, it’s necessary to ship apples and meat to billions of people a day, so these companies were pretty secure with three trillion dollars in the food business within the US alone. They were, however, starting to see a little bit of shakeup from customers asking about new features and services. Food Trace was tracking that and working to build a wonderful user experience. Food Trace wanted to focus on newsletters, blogging, and extra value ads, which were all driving factors when it came to acquisitions. It was their early community and data built around thousands of farmers and food companies that led to acquisitions. Riana says she expects to see a lot of acquisitions this year of blogs, curation services, and customer lists.
The Right Metrics
There were a number of important metrics when it came to selling a business but Riana says the ones they were interested in were less on the revenue side. One key metric that Food Trace followed was customer engagement around blogs and newsletters. This was helpful for making strategic decisions. In addition to a general newsletter, they had a private newsletter that helped them to understand customer growth and engagement. The types of data that interested food industry targets were things like what are consumers looking for, where do they want touchpoints, etc. Engagement was very important as they looked at how interested consumers were, where they were clicking, and where they were hovering. They also tracked subscription growth from week to week and month to month. Food Trace’s goal was to make it easier for food companies they serviced as well as their consumers. Riana knows that managing metrics can be a struggle because it can be a moving target. One thing that makes metrics easier is the number of B2B tools now available that can look at a lot of metrics at any given time. Riana says it’s key to find tools that can give you easy, automated insight. Everyone has access to low-cost tools and it has to be a part of company culture.
What Would You Tell Yourself Ten Years Ago Knowing What You Know Now?
Riana says to spend less money. There were times when she got so excited and threw money at things or people. She was trying to solve about ten things with the business when only about three of them were going to work. She stressed finding low code tools and finding a winning lifelong team of talent. She reminds us that capital doesn’t necessarily equal success. Don’t try and build a full spec team out early just to get all the bells and whistles. Money will never solve all of your problems and the equation many people use for success is weighted too much toward capital.
Where To Learn More.
To learn more, check out journeyfoods.io. Their goal is to help all businesses but they are mostly focused on companies with $20 million+ revenue. They have three main goals for their software platform. One being to help companies save tremendous amounts of time and money on getting their products to marketers, and this revolves around sustainability and cost. Another is to create a wonderful collaborative experience as they believe this is the future of work for food industry teams. The third is to help companies make millions of products better for two billion eaters. They plan to keep announcing new partnerships and features.
PODCAST TRANSCRIPT
Steve McGarry:
Hello everyone. I am here today with Riana Lynn, the founder and CEO of Journey Foods. How are you doing today, Riana?
Riana Lynn:
I’m great. I’m great. Super excited to join your existing list of interviews. And I think this is going to be cool. We don’t always get to talk about the ins and outs of just navigating something that can’t be taught. Right? Because we don’t have classes for this. You start a business, this is not the first thing that they tell you in sort of the business 101 on Google or anywhere else. And so this is always an interesting topic because I think it’s something that’s growing as an option for so many entrepreneurs and startup founders and small business owners. So thank you for reaching out to me, and really happy to talk about my history and my journey here.
Steve McGarry:
Yeah, yeah. Well said. I think it is something that can’t be taught. That’s very well said. It’s something that you just kind of have to learn as you do it. So it’s a fun topic for sure. So before we get into Journey Foods and getting up to date, let’s hear your background, your story. What led you to your first exit? Because I understand that you’ve sold multiple businesses, but where did it start and where did the first exit happen?
Riana Lynn:
Yeah, so I would classify myself a serial entrepreneur. I started my first company in undergrad. I was just doing web development for friends and random people in AOL chat rooms and family members. Actually I thought I was going to be a scientist. When I started my first food company, I was researching at University of Chicago, I was a genetics researcher. And I met actually a top sort of world renowned geneticist that was also the founder of africanancestry.com. So this is ancestry.com 23andMe, he had just been on 60 minutes and I met him at Obama’s inauguration, which is quite interesting because I had built out a video and press company in three weeks so I could get access to all inauguration events. It’s pretty funny. I learned some really awesome Photoshop skills in like three weeks, but I wanted to support some of my friends that were in journalism school and we just wanted that experience. We wanted to cover it and highlight it from our view and so we build out this media company in three weeks.
Riana Lynn:
And I met this geneticist there, and they were just telling his story at one of the events. And I thought it was so interesting that he was a PhD, he was a professor at one of the world’s top schools, but also running this genetics kit company that’s still around today. And so the idea of being both a scientist and entrepreneur intrigued me. And today I merged those into one business. But I, in 2011, launched [inaudible 00:03:32] choose company with a family member, and we were scaling really fast. I think I was such an early adopter to Shopify and different tools throughout the internet, using social media virality very early on, on Instagram and Twitter before they were really popular for businesses, and just all things growth, eyeing growth hacking before I was really even that immersed in Silicon Valley culture.
Riana Lynn:
And so while we were scaling that business, I realized we knew nothing about supply chains and creating a sustainable company. I was growing so fast. I was just like 23 at the time. I looked at our numbers, I looked at the opportunities, I looked at how we were being ranked and getting press across the country, and it just didn’t seem that sustainable and some of our customers were starting to complain. And so I launched a consulting in web development shop from that experience so that I can work with other food founders and health companies that needed a web and e-commerce as a part of their solutions. And so I found a great entrepreneur that was launching a direct from Sri Lanka [inaudible 00:05:16].
Riana Lynn:
I found an entrepreneur that launched a direct from Sri Lanka spice company that I thought just had a tremendous personality. And I thought this was going to be just an awesome story of growth. And when she put her life savings into launching this company and her husband had just lost his job, she wasn’t an entrepreneur from the South side of Chicago, but very vibrant. And we had just really great success in the first few weeks of launch. Orders from all over the country, really optimized a lot of her COGS and cost and goods sold, and really just came in and thought about every part of business development that would help her launch into Q1 with good success and attain profitability fairly early on.
Riana Lynn:
And so at this time she launched her headquarters and brick and mortar just to get some walk-through traffic and sort of market to local community right when The Profit season one was sort of rolling out and starting to get really popular. I was such a big fan of Shark Tank and I was a CNBC head pretty early on, when everyone was probably watching The Bachelor or something, and so Marcus Lemonis team from Profit came into the store, I just handed them cards, said that I’m working with her, helping her grow. And they call me a few days later. I think I had a nice card, too, I’m not going to lie. At that time. It’s like having a really nice LinkedIn or Instagram or Twitter, I don’t know, or a great website. Like some business cards back eight, 10 years ago, if you had a cool business card, people are going to [inaudible 00:07:50] a really nice card and then they followed up, but they were most impressed by her website and e-commerce experience, especially to be such a young company.
Riana Lynn:
We sat down, within a few days. The season two was starting within two months and they had no technology strategy for all of their investments. And so we essentially went through an acquisition and acquire of my [inaudible 00:08:22] dev stock, within I think three or four weeks. And I was [inaudible 00:08:35] away from Marcus and just running around like crazy, trying to initiate Shopify and all these growth hacking and tracking tools for everyone of our investments. And that was pretty much the first acquisition that I really went through. I had friends and other entrepreneurs that I sort of helped think about or started hearing about acquisitions just from entrepreneurs that I started to meet in the Chicago land area as I started to network, but this was 2014, this was my first acquisition and acquire.
Riana Lynn:
And I was like, I mean, after that, especially as we were taking over majority stake in all of these companies, I never really looked at business the same because I started to see that when there’s venture capital and angel investing and scaling businesses, and before I was bootstrapping or taking a little bit of friends and family money, but quite, quite low amounts, just in four or five, low five figures. Compared to what people take today, it’s quite, quite low, to scale up to a seven, eight figure company.
Riana Lynn:
And then I realized that the timelines for investing and taking over a company can literally be weeks to months if it is a need in a vision of the CEO and everything aligns. And so we were instantly taking over these companies and sort of doing acquisitions on myself as a director of technology and growth for The Profit. And I realize that where we were able to grow sales for a business from a few hundred dollars online per day to deep five figures per day, that there’s really no turning back in what technology enablement can do to business growth. And I’ve been bullish on technology e-commerce, especially when it comes to food, ever since. And soon after I still realized that there was a lot of logistics issues, especially in food. If anyone sort of reads my story you’ll know that I’ve stuck to food because I really think that there are a lot of problems in the industry. And that’s sort of where my heart lies. The most, of course, we have shell [inaudible 00:11:17] diversify our interests so we can live happy fruitful lives, but food is my thing and I’ll stay in that.
Riana Lynn:
And so we were actually investing in a lot of food companies. More than 75%, I think, at the time of The Profit season two and season three investments were around food. And these companies were still facing a lot of logistics issues and scaling issues and pricing and COGS issues. And so I decided to launch a logistics supply chain transparency tool that ended up turning into a company called FoodTrace. And what I found when we were investing in these companies was one) brick and mortar sucks. We found this out especially in 2020, and we see the numbers coming out and for reasons why Travis Kalanick has invested so much of his net worth and time into like cloud kitchens, for example, right? Because restaurants and food companies have such low profit margins, because they’re trying to play all these employees and this real estate that cuts in 20, 30, 50% of overall expenses.
Riana Lynn:
And so I thought, well, I think the future of business is in software and away from retail for food, and I just dove right in. And also I wanted to spend more time traveling at that age. I’d be waking up at 4:00 AM to work on websites or going to juice bars and pressed juice and answered customer emails. And we just killed it very early on on Shopify when Shopify looked like Craigslist almost when you logged in. And I wanted more time to meet other entrepreneurs around the world and also spend more time in Silicon Valley. So I made a very conscious effort, late 2014 to dive into software as a service. And in that’s when I launched my next, our third major company, really, and that was FoodTrace in more early 2015.
Steve McGarry:
Got it. Got it. So while you were operating FoodTrace, what was the process like? Because you went through the acquisition, what was that like for you? And I’ve heard so many different stories about how people have met acquiring companies, a couple like at a coffee shop, bumping into people, introductions through investors, advisors, friends, family. How did that process work for you when you were doing FoodTrace?
Riana Lynn:
FoodTrace was such an interesting learning experience. I can’t say that it was the wildest success by any means on an acquisition. They’ve all been, all of my experiences have been very different, would it be the amount of equity acquired, the actual purchase multiple that it provided to myself and other team, or the long-term potential of being a stakeholder in acquiring companies. When I really started thinking about SaaS and finally starting a business, I needed venture backing. This is when you run into rooms with people, especially being a Google entrepreneur in residence at the time, I’m in rooms with people that have sold their company for nine, almost 10 figures. And so this conversation comes up quite early in your business and SaaS, in creating a software as a service.
Riana Lynn:
And so for me, I was always thinking about and tracking food tech and the growth of food tech, and the amount of venture capital being spent and the company that we’re going and acquiring. And also the legacy software companies that haven’t been around for 10, 20 years. You don’t hear about them. Their founders and leadership teams are… enterprise sales are going to these trade shows. They don’t care about press. They don’t care about tech crunch. They don’t care about podcasts. They don’t care about anything. They just, they have eight figure yearly revenue. They have this industry authenticity and trust, but around 2014, 2015, 2016, starting to hear about blockchain and food. You’re starting to see entrepreneurs shift from like creating the most popular Apple app, consumer app and shifting a little bit more over to more impact software and apps. And so they’re getting a little scared, right?
Riana Lynn:
And putting feeler [inaudible 00:16:59] these old food companies, and still today have terrible designs. I mean, they’re so clunky and outdated, but they just… Food is a pillar of human life. And so it’s necessary to ship apples and meat to millions and billions of people every single day. So there’s just so much money in agribusiness, $3 trillion floating around just in the U.S. alone. And so these companies are very secure, but they’re starting to see a little bit of a shakeup from their customers asking about their new services and features. And so we were trying, starting to track that, and we’re building just a wonderful user experience at FoodTrace. We’re talking about blockchain, we’re in the rooms. I’m a young black woman in her twenties that are starting to be in rooms with older men that have been in food for decades more than my age.
Riana Lynn:
And so I think that invigoration of new talent and new interest in the food industry immediately became of interest for any larger industry incumbent. And so what we wanted to focus on, as we have less industry experience and context are things like newsletters, trust, blogging, extra value adds for our customers even before we were able to create more deep, complex software solutions for them. And so we built that very early on. And I think that’s been a driving factor when it comes to acquisitions, and you’ll see more acquisitions just this year of blogs and curation services and just customer lists and those things. And that actually was the main driver for our acquisition for FoodTrace.
Steve McGarry:
Got it.
Riana Lynn:
Was that early business development side, the early community and data build that we had around thousands of farmers and restaurants and food companies across the country.
Steve McGarry:
Yeah. That’s a great segue into the next question here, which is around metrics. I think a lot of people are constantly searching for their success metrics, especially if it comes to potentially selling a business. When you were doing FoodTrace, you were an EIR at Google, what were the success metrics you were tracking? It sounds like you’re tracking the number of users. What can you share about what you were tracking leading up to the exit?
Speaker 5:
So I would say there were four key metrics that we were really looking at, less so on the revenue side, because we were still sort of part services, part subscription. We were really shaking out if we wanted to be a freemium model or not. And so what I loved is that, one) customer engagement around our blogs, our newsletters and our sort of general data updates, so cohort analysis of what was happening in the platform that was very helpful for strategic decisions of all of our customers. And so we had more of a private enterprise newsletter and then a general newsletter that went out to just everyone in the market, even our investors in people that just supported us along the way, friends and all that stuff.
Speaker 5:
In that private newsletter, we were able to really understand our customer growth and our customer engagement, and then the types of data that most interested our food industry targets. And so this is, how many points of contact does your food have? Like what are consumers looking for and the traceability of products. Where do they want touch points for where their products are coming and going from that they’re purchasing. And so we were able to just drive these cohort metrics into our customers. So I’ll sort of group that together, it’s just like cohort metrics, which is really like market insights. More detailed market insights is important for your customers and the engagement around that. How interested are your customers in that? How much are they clicking on that, opening that, deep diving into that information? What are the engagement rates? How far down the page are they looking at and where are they hovering? So doing a little bit of that analysis.
Speaker 5:
How much are your user lists and subscriptions growing on a week-to-week, month-to-month basis? That’s a big metric for us. And then how, downstream, if our customers are looking at maps of the products and where they’re coming from, how much engagement are we serving downstream B-to-B-to-C, right? A few choices really focus on the B-to-B-to-C. How are we developing an enterprise software solution that helps make it easier for the food companies that we service, but also for all of their consumers? And so we were looking at the engagement rates of the eaters or consumers of our target companies.
Steve McGarry:
Got it. Got it. Yeah, I think managing metrics and determining what success is for you as a business has always been a struggle for a lot of people out there because they can kind of morph and change as you grow. And it’s always kind of a moving target in my experience, but there’s always a few that are like the cores, and I like that engagement is really something that you guys were focusing on growing that community around FoodTrace.
Speaker 5:
Yes. Definitely. And back in 2013, 2016, I mean, there were no tools for… There were a few, you had Google, Google analytics and some mixed panel and all those things, but today you have Databox and Segment and all of these tools that you can find on Product Hunt on any given day, all these enterprise B-to-B tools that are now available for you to track anything you want. And they even sort of use AI to give you suggestions on where your largest metrics targets can be. I think that has to be a part of your company culture very early on. Sort of metrics, strategy driven approaches to your product and to your customers. And you’ll find the sweet spot of what really counts for them, because of course, you’re just trying to find product market fit very early on, but finding the tools that can help give you very easy, automated insight into how your business is operating or how it’s engaged is very key.
Speaker 5:
We have automations that we put through Zapier and Slack so that we’d only need to have to load a dashboard at this point. Every Monday morning, I can get snapshots of these accounts in a graphic form or anything, just a list view right to my Slack channel. And so this is automated. It’s really automated now. And it’s almost like an assistant waking me up and telling me how things are doing. But it really has to be a part of the company culture. And what’s great now is every business owner has access to low cost tools that don’t cost more than anywhere from 20 to $200 a month to have that pretty seamless into your business operations.
Steve McGarry:
Got it. Got it. So we’ve gone over your extensive background, we’ve gone over the multiple exits that you’ve had. The kind of finale question before we kind of send people to what you’re working on now. The finale question I’d like to ask everybody is, knowing what you know now, what would you tell Riana 10 years ago?
Speaker 5:
Spend less money. I mean, there are times when you get so excited as an entrepreneur and you throw money at things or people, and there’s just so many ways to hack earlier lessons before you dive in. I mean, there’s going to be like 10 things that you try to solve with your business, and like three of them are really going to work. If you can stay as lean as possible, I mean, just that’s the way to win. And so finding low code tools, doing as many customer surveys as early as possible, finding their winning sort of lifelong team of advisers and talent around you is important so that you can spin up things and spend down things very fast. And so there are so many times where I just…
Speaker 5:
I mean, capital does not equal success. There’s a great thread on Twitter, Justin Kahn, who raised, I think a 100 million or 60 million for his legal tech company a couple of years ago and it failed after he just hired all these people. They didn’t have product market fit. They were trying to throw money at culture and everything. It’s like raise that low pre-seed round or friends and family round for that first year, really get it right. Really survey as much as possible, keep as much low code solutions as you can know, don’t try to build a full stack team out early to get all the bells and whistles and you’ll see a jump in that growth once you really hit it and get that true customer understanding. And so capital is not going to solve your problems or make your business successful. That’s not… What I’ll say is the equation that people use to think that it’s like targeting the likelihood of success, it’s a little bit too weighted toward capital. So yes, that’s sort of how I would best answer that.
Steve McGarry:
Well said, well said. Well, those are all the questions I have for you. What are you working on now, briefly? And where can people go and learn more about it?
Speaker 5:
Yeah. So this is more of my life’s work at Journey Foods, journeyfoods.io. We are focused on helping businesses of all sizes, but mostly businesses 20 million revenue plus. We’ll open a little bit more for smaller businesses as we sort of are now just curating, but we have three goals for Journey Foods’ software platform, and that is help companies save a tremendous amount of time and money on getting their products to market or improving their current products in the market. And that’s around the sustainability and the cost and the nutrition of their products, to create a very wonderful collaborative experience. As we believe Journey Foods is a future of work for food industry teams. And finally, help companies make millions of products better for 2 billion eaters. And we’ll be announcing a lot of partnerships in and new features throughout the year, of course, and hope we can continue to attract great talent, great partners, great investors, and great, great customers so we can achieve those three things.
Steve McGarry:
Awesome. Awesome. Well, thank you so much for coming on the show, Riana, this was really special, and sharing your story. I’m sure a lot of people are really going to enjoy this. And thank you so much for coming on the show.
Speaker 5:
Yeah. Thank you so much for your questions. Really enjoyed it. I can’t wait to share it.
Steve McGarry:
Yeah, for sure. And everybody listening on Spotify or iTunes, check the links in the show notes for everything that Riana mentioned.
