Company: What was once meant to be a side gig for co-founder Pete Maldonado — meat stick company Chomps — quickly became the main commotion.
Back in college, Maldonado was a personal trainer. The problem he constantly encountered was the difficulty of keeping customers on an elaborate meal plan. Most of them kept busy and were often on the run. “That’s where the idea came from,” he says.
Chomps was launched with the aim of recreating conventional gas station snacks, but as a healthy alternative. Meat Sticks are made with high-quality protein from sustainable sources like grass-fed beef and venison. The company promotes its snacks as being free of hormones, antibiotics and added sugars.
This business idea was launched in 2012. Maldonado and his business partner Rashid Ali invested a total of $6,500 in the business to get it off the ground. They created a website, and Maldonado says proof of concept followed soon after.
Now the snacks are available at just under 19,000 retail stores in the United States, including Walmart, Whole Foods Market, Trader Joe’s and online retailers like Amazon and Thrive Market. Annual revenue is expected to exceed $115 million in 2022.
Best Advice: Maldonado admits he is easily distracted. So when a friend told him to “pick one thing you’re really good at and focus on that,” Maldonado listened.
Five years later, Chomps was born. Maldonado says the tips helped him stop jumping on different occasions and focus on one. “So I used all the skills I learned to train Chomps,” he says.
Tipping point: The best thing Maldonado and his partner Ali ever did for the business was start it, or start and grow the business with little capital and no outside investment.
The problem with startups relying on investment, Maldonado says, is that they “get too comfortable with the idea of spending money.”
The need for money that came with that decision, he says, gave the partners the push they needed to sell more products. “We had no choice,” Maldonado said. “It was sink or swim.”
For 10 years, Chomps has been a self-sufficient business. Earlier this year, that changed with an $80 million minority investment from Boston-area private equity firm Stride. The investment, a first for the company, was made to help accelerate innovation, brand building and distribution.
The extra help is welcome, Maldonado says, given the team has struggled to keep up with demand at times.
“We grew much faster than expected,” he says, adding that at one point Chomps failed to place a large enough order with a supplier, which led to a big drop in trading. detail: empty shelves. “Our production partners couldn’t meet the demand. We have reached a ceiling.
So now the company is increasing secondary and tertiary manufacturing sources so that demand does not exceed supply again. “If the customer can’t find it, they move on,” he says.
Nocturnal worry: Not having enough product on the shelves is the least of the worries, especially after the past two years. Now Maldonado stays awake at night worrying about external factors.
“You never know what decisions will be made, even at the political level,” he says. “We cannot anticipate what will happen.”
The company has done some things to remove some of the risk. Like setting up an additional or alternative supplier and creating diversification in the revenue stream. For example, Chomps has multiple channels to generate sales. Customers can buy meat sticks from the company’s website, other online retailers like Amazon, and in person at places like Walmart. This was especially important during the pandemic, when in-store sales plummeted.
“If you weren’t ready for it,” he says, “it was really bad for a lot of companies.”
Best pandemic decision: “Continue on all our people,” he said without hesitation.
The company saw a slight drop in revenue, he says, but has largely been able to continue selling meat sticks online. And not only has this allowed the company to keep the team together, but it has also increased the payroll.
“We actually kept hiring,” he says. The company was able to find strong talent thanks to the pandemic, he adds.
But while the layoffs were at the bottom of the line, that’s not to say things haven’t gotten scary.
At the start of the pandemic, when toilet paper was in short supply, for example, staples like Chomps meat sticks were also flying off the shelves. As the number of customers grew, one of Chomps’ retail customers sent in a purchase order to get the company to start producing more to sell. Maldonado declined to provide the name for legal reasons, adding that the client is still one of Chomps’ biggest retail clients to date.
Shortly after production resumed, the customer withdrew the purchase orders. And Chomps was left “jamming”, with all the extra product.
Almost overnight, the company had to reassess how it was going to sell the extra product and deal with possible losses. Maldonado says the company cut its marketing budget and looked at other areas, noting employees would have been the last to go. “Without our employees, he says, our company does not exist.
Outside work: While Maldonado works from home some days, he still can’t get enough of his family.
The proud dad, who says there’s another ‘bun in the oven’, spends days on the water in the boat with his wife, Stephanie, and two children, Rocklyn, 2, and Maverick, 5 years.
Maldonado also has a new side gig. Maverick, named after Pete “Maverick” Mitchell’s character played by Tom Cruise in the movie “Top Gun”, recently started playing tee-ball. Helping with that, Maldonado says, is “the best thing ever.”