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Courier Weekly Friday 20 November 2020

Courier Weekly Friday 20 November 2020

Roxana Saidi, founder of new pistachio milk brand Táche, shares the challenges of growing a new product category and lessons on working with your family.

DANIEL GIACOPELLI: Hey guys, Danny here, Courier’s editorial director. You’re listening to the Courier Weekly.

First there was almond milk. Then there was oat – which now makes up a monster share of the multi-billion-dollar dairy-free milk market, with brands like Oatly leading the way. Well, this week I’m with Roxana Saidi, who says pistachio milk could be next. 

Growing up as an Iranian-American, Roxana remembers eating pistachios all the time – they were as common as potato chips, she says. And, as an adult, she realised the snack was one of the only nut alternatives not being used on a massive scale in the alternative milk market. Roxana’s now the founder of Táche, a pistachio milk brand she launched on Wednesday this week after years of development. She calls it the first ‘true’ pistachio milk in the US. 

There’s a lot to dig into here, from the challenges of growing a new product category to working with your family, so let’s just get into it. Here’s Roxana.

ROXANA SAIDI: Almost daily, someone will say to me: why pistachios? And almost instantaneously, a vivid image pops into my mind every single time. And it's me, I'm five years old, my dad is teaching me – or rather, attempting to teach me – how to crack open my first pistachio. My dad emigrated from the Middle East to Michigan to attend the University of Michigan when he was about 18. I joke that pistachios are to Middle Eastern households as potato chips are to US households. It's a must-have, on-hand snack. So, in my household growing up, we always had pistachios and they were these big, beautiful, colourful pistachios, very different from what you would traditionally see at a grocery store or even a gas station wherever here in the US. 

DANIEL: And where did he get them from? Did he know a guy who knows a guy or did he get them from the local shop? 

ROXANA: It was very much he knew a guy. They came over from the Middle East. They were the ones that he grew up eating. So it was very much not just down at the local independent grocery store. It came from a guy! 

DANIEL: Smuggled in a suitcase from Tehran! 

ROXANA: Like many things. But, in this case, it was just pistachios and they were delicious. They were unlike anything else. And, I also had a fun time as a kid as it's an activity – you get to play with it a little bit and then be nourished at the same time. So I was the kid on the playground who had a bag of pistachios and other kids would say, ‘What's that?’ Or, ‘What are you doing there?’ And so it was fun. 

DANIEL: I have to say, they are my favourite nut. I eat them all the time. Pistachio ice cream is my favourite ice cream. So I totally feel you there about eating it when you're a kid. People think it's weird. Maybe it's because I'm part Sicilian and they like pistachio, too, quite a lot. 

ROXANA: There you go. Yes, Sicilian pistachios, another great one. 

DANIEL: When you grew up, obviously there was a proverbial light-bulb moment when you said plant-based milk is soaring to the stratosphere as a market segment, but no one was really taking advantage so much of the humble pistachio. Why was that? I mean, there's obviously money in pistachios, but it wasn't all over the place. It wasn't like almond milk. There was really nobody doing it on a big level. 

ROXANA: Yeah. I'll start at the beginning. For me, it was around the year 2015. I was drinking copious amounts of almond milk. I was eating copious amounts of almond butter. It was pretty ubiquitous throughout the US. But I was at a long family lunch in Paris and I was longing for an almond milk latte. And, at that point, all the milk had not made its way over the Atlantic and it wasn't ubiquitous throughout Europe. So at that moment, I had the clichéd light-bulb moment where I just thought: wait, can I go home and whip up some pistachio milk in my own kitchen or even make pistachio butter in my own kitchen the same way that almonds are produced? And wouldn't that be so much more interesting from a flavour standpoint? And so that's exactly what I did when I got back to New York. I started making all kinds of pistachio butters and milk in my little kitchen in New York City. And the immediate question I had to answer is your question: why doesn't this already exist? 

So many folks love pistachio gelato, pistachio ice cream, but that's really sort of… there's the ice cream and then there's snacking as a roasted or unroasted nut. And that was the extent of the pistachio in the United States. And I thought: this is such an untapped opportunity and there's so much love and sentiment around the pistachio. Couldn't we take this so much further? So I had to peel back why it didn't already exist. Because to me it seemed fairly obvious. 

DANIEL: Right. And that's the thing, because quite a lot of times when something doesn't exist, you assume an entrepreneur tried it and failed terribly for some reason. 

ROXANA: Exactly right. So I was sure if I did enough digging, I would uncover: oh, this is what happens – it's the one nut you can't do this with because of X, Y or Z. I spent endless hours. I talked with endless formulators. There was none of that. The reason was supply chain. So creating a supply chain of high-quality pistachios at an approachable price is really challenging. And I knew from the onset that I did not want to create a product at a price point that was so high that most people could never afford or would just say: whoa, that's crazy. I didn't want to make a 10-dollar pistachio milk. I really wanted to make a pistachio milk that was, of course, going to be premium and priced slightly above maybe what almond was at the time, but not something two-fold or 3x. 

As soon as I established that we could secure a supply chain of high-quality pistachios at a product MSRP that was approachable, then it was like: OK, this has legs; this has a lot of merit – let's see if we can put this together. So, at that point, I brought in my father, who at the time was a retired Silicon Valley entrepreneur himself. He was in the business of building cell phone chips. So he had founded and exited a few startups in Silicon Valley. Very smart, very successful. But coming in to help me build Táche was a huge departure from what he knew. But I knew that his really strong entrepreneurial background was going to be a huge asset to building Táche with me. 

DANIEL: Did that take a bit of convincing? I mean, I imagine his 20- or 30-something daughter coming and saying, ‘Dad I want to build a food-and-drink direct-to-consumer brand with cool branding based on pistachios, can you help me?’ He was probably like, ‘Let me think about that…’ 

ROXANA: You know, I always joke, I say not all dads would say, ‘Sure, let me jump into my fourth startup with my daughter after being pretty comfortable in retirement’ – I don't know many dads that would. But he didn't hesitate. He jumped right in. And I actually think that has a lot to do with the fact that 1), he believed in pistachios, 2) of course, he believed in me, and 3) he saw me launch a social media agency back in 2011 when those did not exist. And he said, ‘I don't know that this is the right move, Roxana. I think that you should go get your MBA. I don't think social media is going to be a lasting thing the way that you think that it is.’ 

DANIEL: Famous last words! 

ROXANA: Yeah, exactly. So I think it was a combination of those three factors. 

DANIEL: That's great. So, what was step one? You had an inkling that this could be big. What then did you do? Did you fly over to Iran and look for a pistachio farm? Or California? Where did you go? 

ROXANA: What we did was we sourced pistachios from all over the world, actually. So Turkey's a big one, Sicily is a big one, Spain, California is a huge exporter of pistachios. So we sourced pistachios from everywhere because I wanted to have a side-by-side comparison of all pistachios and see in the formulation process – which we hired a formulation team specifically; they only do beverages – to do formulation work on all different types of pistachios. 

DANIEL: When you say ‘source’, do you mean you called up a farm literally and said, ‘Hey, I want to order 50 kilos of pistachios? Could you send it to my home address?’ 

ROXANA: Sure. Exactly like that. Just instead of 50, it was more like 10. That's what we did. And so we did all these side-by-side trials. We actually did 24 iterations of our formula. And, in the end, what was really striking and really astounding was that pistachios aren't that different from grapes. I say this all the time. You expect it should result in the same thing. But just like wine, grapes from Italy versus grapes from New Zealand, it all produces very different wine. Climate, soil, farming techniques – all of that stuff plays a big factor in pistachios as well. 

So, in our formulation, in R&D, we noticed that the California pistachios had an enormous difference, like the polar opposite from what we were experiencing from those in the Middle East. So much so that sometimes we found that it really tasted like it was synthetic, almost kind of made in a lab. It had a really long, lingering, unpleasant aftertaste. It didn't have that smooth finish, that really nice nuttiness with a natural hint of sweetness that the Middle Eastern pistachios were producing. 

That's when we decided, OK, that's another component that factors into why this doesn't already exist and why it's not already on the shelf. To answer your question, that was step one. We hired the formulation team and we did all these side-by-side trials. The formulation work took about a year and that ended up with us having three flavours of Táche. So there's the original, which has a little bit of added sugar. Then there's the unsweetened, which of course has no added sugar. And then we also developed vanilla. So when we launch, we'll just be launching with the original and the unsweetened. But vanilla will follow soon thereafter. 

DANIEL: And were you closely developing the business model as closely as you were developing the formulation of the actual drink? Did you know you wanted to sell direct-to-consumer or wholesale? 

ROXANA: Yes, absolutely. So podcasts just like this, I was really immersing myself as much as I could in this new industry that I formerly knew nothing about. So what do buybacks look like? What does UNFI mean? All of these things I was learning and absorbing, and the tip that I was hearing is: you really have to choose your channel strategy wisely. It's not about how many doors you're in; it's about velocity. All these things that I had never heard of before. So we decided that traditional retail was not something we were going to pursue in the beginning. Of course, I'm mapping this whole plan having no idea what 2020 holds in store. At the same time, Oatly was really making its way into the US landscape and they were doing that through food service, which is coffee shops, third-wave coffee, matcha bars. 

DANIEL: And they've just absolutely dominated that entire space. 

ROXANA: Absolutely dominated. I remember walking around the West Village and seeing signs on coffee shop doors in all caps saying: ‘We do not have any more Oatly, sorry. Don't harass us about it. We don't have it.’ So, for us, it was going to be direct-to-consumer and then also drive that discoverability through food service. And being in the New York City area, what could be better than launching here and kind of using that Oatly playbook a little bit through coffee shops. 

DANIEL: Right. Because I wanted to ask you: what are the big challenges of being one of the pioneers in a new market category like pistachio milk? Because I imagine 99% of Americans will have never heard of pistachio milk or know it's a thing or even a possibility. You probably have a lot of education to do to show people this exists, this is the nutrition factor. Yeah, I mean, it's just a lot of work. Pioneering involves a lot of teaching. 

ROXANA: Right, absolutely. I would say the biggest hurdle is just that initial alt-milk fatigue that consumers have experienced. I understand why there's a chuckle or an eye-roll when you say pistachio milk and people think, ‘Do we need another one?’ And really our joke is, no, we don't. And it's OK that you have that fatigue. I get it. But, really, what's been so wonderful is that when people try Táche, that immediately goes away. 

DANIEL: When you say fatigue, do you mean your mom and dad kind of eye-rolling at millennials with their avocado toast? Or do you mean from people who would be your potential customer? Where they're like, ‘I don't necessarily need another option.’ 

ROXANA: The latter. So, a great example is that I used to be really scrappy and I would go around to all the specialty coffee shops that I loved and had been a fan of for so long. And I would just grab the barista or the wholesale buyer, whomever, and I'd say, ‘I'm launching this new pistachio milk called Táche. Can you test it? Give me your raw, honest feedback.’ And they would say, ‘That sounds so good, but we've introduced so many milks over the years. There's a lot of options. It's hard for us to keep up with all of them.’ So it was that: there's a lot of interest, but there's a lot of options. Luckily for us, because Táche is so distinctly delicious on its own, as well as in coffee and matcha, that once their taste buds had the experience, it was no longer a consideration of, ‘Oh, there's too many.’ It was just like, ‘Oh, wow, this is actually good. This actually doesn't compromise on flavour.’ And that's interesting and differentiates Táche from a lot of the other milk options. 

DANIEL: Do you have a targeted programme, then, for getting baristas to buy into this? Because I imagine they are your best salespeople. 

ROXANA: Yes. So, we're very lucky. In New York City, there is one distributor that distributes to the vast majority of these shops in New York City and I mean about 750 of them. So, luckily, this distributor I cold-called, I wouldn't take no for an answer – I finally went out to their location and met with them for a couple of hours. And they picked up Táche very early on. So that was a huge turning point for us, being able to validate Táche as a player in the New York City area. And other than that, I've just built a lot of relationships over the last few years. I met with a lot of these baristas and formed relationships and friendships, truly because, at my core, I'm a coffee fan. I love everything about it. My mom had me drinking lattes when I was far too young!

DANIEL: How does pistachio milk taste in coffee? 

ROXANA: It's very subtle. It's complementary. It does not overpower your coffee by any means. It's really nice with the floral notes of coffee. So, that's a particularly strong one. In fact, one of our earliest partners is Devoción Coffee. And what they do is they fly in their coffee via next-day air. So it's the freshest coffee you can get in New York City. And he says it plays really nicely with a variety of different types of coffee. And we're really excited about that because, in the earliest days of Táche, I really didn't know how it would interact with certain coffees. I didn't know if it would have that overpowering effect or if it would be complementary. And, luckily, it ended up being very complementary. 

DANIEL: And now you're launching smack dab in the middle of a pandemic that, in the US at least, is getting worse and worse and worse every week. What the hell has that been like? Because, let's face it, people aren't going to cafes, really, or at least not a lot of people are going to cafes. Supply chains are disrupted. It's just a topsy-turvy world. 

ROXANA: That's right. And there's also been an election, so there's all these converging, life-altering dual pandemics, if you will. And so we actually had to push back our launch in light of the election. We wanted to make sure that, during such a pivotal time in our country's culture, that understanding the unpredictable nature of the election news cycle and that we needed to let that have its moment and really not rush into having our moment because it pales in comparison. So we had to push back our launch and even this most recent time with the pandemic and its effect on coffee shop supply chains, everything you mentioned, we pushed back our launch a few more times ahead of that one. And they're all things that you just have to, of course, roll with the punches. They're to be expected. But the most important thing for us is that we really support our coffee shop partners. We know how much and how hard it is just to survive the day, you know? So really supporting them in any way that we can. We're always there providing as many samples as we can, education, and just engaging with them and their customers and meeting them where they are. 

DANIEL: Are there any other uses of pistachio that you see that you might enter in the coming years? I mean, the brand name is Táche, so you could do anything with pistachio. It's not called ‘Táche Milk’ or something like that. You know, you could go into snacks, you could go into skincare. I have no idea! Are you thinking about it? 

ROXANA: Yeah, you're not wrong. I think I did see – we're not going into skincare or beauty – but I'm pretty sure I saw body lotion and maybe a conditioner at one point because those natural oils are great that are in pistachios. There's a plethora of directions Táche can go in. Right now we are focusing on the milk, going into flavours, excited about doing individual serving sizes of Táche. Most folks have remarked that they'd love to drink it on its own. So I'm staying within the milk category for the foreseeable future. But, yes, to your point, all the exploding plant-based categories across everything from cheese to ice cream to yoghurt, those all definitely have a lot of merit. 

DANIEL: Within those different alternative milk categories, the plant-based dairy-free categories, do you think as oat milk declines in popularity – I mean, it's not, but I guess if it does – is it kind of a winner-takes-all thing? Or could everybody rise at the same time? Or do you see trends going up and down? I mean, are people drinking almond milk less than they were? 

ROXANA: Yes, I've seen a lot change over the last few years. When Táche first came to me, almond milk was the queen, I say. Almond milk was dominating. Oat milk didn't even exist in the US yet. So now that's the inverse. 

DANIEL: Right, I mean, if you go to a cafe here in London, it's literally just do you want milk or oat milk? Rarely do they have almond. It's kind of just oat or dairy milk. 

ROXANA: Yeah, I'm torn about it because almond milk is what brought me into this world, right? So I'm grateful in that way. But we talk to retailers all the time out in California and they say, ‘We're no longer serving almond milk. We can't justify it from the sustainability standpoint.’ It has an impact on water in a very detrimental way. 

DANIEL: Because it takes quite a lot of water to make one almond, right? 

ROXANA: It takes quite a lot of water. Almonds have a very large water footprint. It also is having a big impact on the bee population in California that have to pollinate the trees. It's a bit fraught, the issue, but to your point, almond milk is losing market share and oat milk is the dominant player. I don't really believe it's a winner takes all. Coconut milk does really well. There are other smaller players. But I think overall, as long as, truthfully, we're moving away from dairy milk, then it's win-win. So that's my position on it. 

DANIEL: Do you see one day – and I know we're really getting ahead of ourselves – but would you like to own your own farm at some point and do a completely vertical operation? 

ROXANA: Absolutely. That is the dream. Pistachios are to my family so much more than just a snack – it goes back generations in my family. So that would be lovely, although it is not in the current plan. 

DANIEL: Because I was talking to Aishwarya from Brightland recently. She has a very, very close relationship with her olive… orchards? Olive farms, I guess! In California. And I didn't know if you wanted to get much more integrated with the actual process of growing the pistachios at some point. 

ROXANA: Of course, of course. Also because with going organic, which we are not right now, that becomes much more of a reality for us. So it's absolutely something we would like to become much closer to and be vertically integrated. I will say that most alt-milks out there are not organic currently, so it's not something that's a pressing issue, but down the line at some point, absolutely. 

DANIEL: And how's it been running the company with your dad? 

ROXANA: You know, I cannot complain at all. It's been really great. There's times where it becomes a challenge. When you try to shift away from work, it's the weekend, you're trying to cut loose a little bit. And we both tend to weave in and out. And so it takes a bit of a concerted effort on someone's part. Like, remember, we're not weaving in and out. So that's the only tough part. Other than that, I just feel very grateful and very lucky to have him and his expertise, especially in the fundraising aspect of this business, something I had never done before. I never thought that I would be raising over a million dollars during a pandemic, but having his support and his knowhow throughout it all was immensely helpful to me.

DANIEL: That was Roxana Saidi, founder of Táche. And that’s it for this week. As ever, get in touch with any comments or ideas – I’m daniel@couriermedia.co. The Courier Weekly’s back again next Friday. See you then.