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Scott Morris

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2023-10-09
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2023-10-09
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  1. No. No, they didn't have any refrigerators. And the original idea was, oh, well, we'll let the retailers buy the refrigerators. And they said, Are you kidding? You want me to spend our money on your refrigerator?

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  2. Yes, we just thought it was a, we both agreed, both the retailers and us agreed that we thought it was the consumers were fairly progressive around nutrition. Now, honestly, for us, the other thing is we wanted to be able to test it in a place where we could have like one distribution network. It ended up being a van that we literally ended up hiring someone to drive a van to deliver to the stores because that was one of the next challenges was no one wanted to carry the product for us none of the distributors.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  3. Yeah, at this point it was still, I would say, still that friends and family group, but at the time we finally talked both Pet Smart and PECCO into doing a small test with us in the San Francisco Bay Area.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  4. So, you needed some retailers to put this in their coolers, right? And by the way, at this point, this was still, I mean, you guys were still financing this with some of the friends and family money and then the money that you guys pulled together.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  5. I was still living in New Jersey and Caho had been back and forth a little bit. He originally started off in San Francisco, and then he moved to New York, we figured we all need to be together. So he was now living in New Jersey too.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  6. There's a range of dogs. There are dogs that will eat almost anything. Then there's a very large group of dogs that will not eat almost nothing. And we wanted to test with all the dogs. And part of it was about taste, but we had to make sure the nutrition worked for the pets. And then when the consumer opens it up, they have to look at it and go, oh my God, this looks good. It looks like food I could eat. And we would literally go out of our way to make sure it smelled good for the consumer. So the first tip is the dog loves it and eats all of it. And then the more people use it and the longer they used it, the more they saw literally a visible difference in their dog's health in some way.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  7. And then part of it is where you have to bring the temperature down pretty quickly. So we were trying to follow kind of the USDA guidelines around how to actually do pasteurization on foods.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  8. Yeah, we had space in that facility and we started bringing equipment. And initially it was just a simple mixer and then it was a giant steam oven. And then we had something that was, it's called a chub machine or a KPAC machine where it basically puts the meat into the sleeve. And then initially we were putting in these giant pallet-sized totes of ice water to cool it down because part of pasteurization is the cooking part where you heat it up or the steam oven. Yeah.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  9. No, it was our facility. So it was their building and it was, we rented right next to in this chicken processing facility where they made human meats.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  10. I think maybe it was just chicken and turkey in the very beginning, but soon after we were using beef also. So we wanted to have a handful of different proteins because different people and dogs like different types of proteins. And I would say it was probably a year of testing and trying and tinkering before we thought we had it, but a lot of times today you'll hear people say it's version one or v1. I would say that was v1. And we thought it was ready to go to market. And the reality was it probably was good, but it wasn't where it quite needed to be on kind of that version one.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  11. Exactly, they did. They did. They produced meat for humans and actually the pet food market. Okay. And we actually convinced them to let us have 10,000 square feet of their manufacturing facility kind of off on the side in this other room. And that's literally where the trials to start making fresh pit started.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  12. Yeah. You know, it's interesting. We actually worked with a team of, initially veterinary nutritionists, and we said, what's the perfect pet? What's your dream pet food? Tell us what it is. And they had some ideas. And then we continued to talk to different people that were involved in processing different foods and cooking different foods on the human food side. And we started in the first partner I think we had with FreshPet was a group called the Hunsbergers. It was in Quakertown, Pennsylvania.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  13. Let me ask you about, let's just go back to making it, right? You wanted to make something that was fresh. Could be shelf stable for 12 weeks, I think, three months And it was slicable. Those are all challenging.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  14. Exactly. And it was referred to in the industry as the humanization of pets. So this idea were becoming more like kids or humans. And the thing I kept asking everyone in the industry was If everyone realizes that this idea around humanization of pets, why are we feeding them, honestly like farm animals? Because initially Kibble came from animal feed in the 40s, 50s, 60s. That's really where that grew out of the idea of having a kibble. So we should probably be feeding them differently.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  15. And then the second piece of it, just like you were mentioning, dogs were becoming an incredibly important part of our lives. And the simple analogy is maybe 50 years ago, they were mostly in the backyard and they went from the backyard to the doghouse to the garage to the laundry room.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  16. Exactly, exactly. They needed to start eating a better diet for themselves. Now, whether they did that or not is another story.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  17. There were two major trends that we were watching, and one of them was that people were definitely starting to head down that path of like, I'm becoming more aware that I need to eat better food and less processed food.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  18. Because, and if you think about, so there's two aspects to the product. One of them is we wanted to use the freshest ingredients we possibly could. And the second thing was we want to cook it as little as possible because we, again, John and I were really focused on this idea of bioavailability. So the more you cook certain ingredients, the less bioavailability or nutrition that there actually is for the person or for the pet. And you needed refrigeration in order to keep it fresh.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  19. So, you wanted it to be like a meatloaf rather than like a sort of a refrigerated, like canned, wet canned food and it would be sold in a Tupperware container, but you wanted something that was more like a meatloaf that would be sliced.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  20. To make it where it was nutritionally complete, it looked appealing to the consumer. It had great shelf life. It lasted for a really long time. It was firm enough to cut. So it was a good experience, again, for the consumer. It smelled good. So we kept working it, working it, working it.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  21. It's not convened at all. In fact, it's the exact opposite. And people love, although they were nutrition aware and although pets were part of their lives, they love convenience. And we felt like that was one of the big And it was one of these situations where I think a lot of people looked at it, both in the industry and the retailers, and it was so different they couldn't get their head around it. And the thing I always recognized was if something was so different, it's either brilliant or completely stupid. And I think in 2006, the verdict was out for quite a while.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  22. I mean, you had experience in the industry. You knew that who bought canned food. You knew who bought dry food. But surely it was risky to think about refrigerated food because, you know, it isn't as convenient.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  23. Yeah, no, you're exactly right. We literally, we did. The analogy I would give you is we knew we wanted to make cookies, but we didn't have a recipe. We knew the product we wanted, but we didn't exactly know how to make it all. So, yes, you had to find meat and other ingredients, and you had to figure out, well, how do you, what types of ingredients? What are the specifications of them? It has to meet certain nutrition requirements. How do you cook them? How do you actually cook it? How do you get it into the package? And we started figuring it out.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  24. So you kind of start the process of, I guess, initially just exploring how you would do this. And I would imagine this 2006, I'd imagine it's like making Jimmy Dean sausages or something, right? I just think of that because it's like a round tube of meat that you would go and you would find meat. Rind it up and just put it in a tube. I mean, first of all, what was the first step you had to take? I mean, you had to source meat, I guess, initially, and find a place to make this

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  25. So we did cobble together some money for sure. Kahole and John actually both took out some loans. And I had a little bit, but we cobbled together. It was like, I think it was $875,000, if I remember the number initially. And what we learned quickly was that sounds like a lot of money, but it's not at all. And when you start doing packaging and you start trying to figure out how to initially import product, and then you're trying to sell it in and then you're paying for refrigerators, and then you suddenly realize I have to figure out how to make this product because what I'm getting just doesn't work. It's incredibly expensive typically to start up some type of manufacturing operation.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  26. No, it didn't exist at all in the US. There was some raw food in the US, like what was originally done in Australia, but it was frozen. So I think it was definitely that's where the initial inspiration came from. But we knew we had to do it completely differently here in the US. We knew we needed someone to kind of help kick this off and that could really start immediately. And that was this gentleman Cahole. Kaho worked with Nestle in Australia, and Kahl started writing a business plan. So I think we all started working together to try and figure out, well, how do we make this food?

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  27. But the point is that people were buying, they weren't buying dry pet food or wet pet food in a can, they were buying it in a refrigerated section, which I guess in 2006 did not really exist in the US

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  28. Yeah, it was actually initially when it was launched. It was literally just ground raw meat and it was kind of all the leftovers. It was done very, very differently in Australia. It had byproducts. It had preservatives. It had kind of like all the scraps. I mean, everything in there.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  29. We were in the pet food business. John worked with me at Meow Mix and then Kahole was not at Meow Mix, but John had worked with him in Australia, actually. And they had seen fresh pet food.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  30. And that led me and two other gentlemen to start thinking about if we reinvented pet food, like if we were going to start literally with a completely clean sheet of paper from scratch, what would we make? What would that product be? And we started thinking it probably wouldn't be Kibble because the conversation literally was, is Kibble even food?

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  31. So, you know how you have these times in your life that are incredibly like you remember like it was yesterday and it's just crystal clear. And I remember there were a few of us sitting around talking about like maybe what we wanted to do next. And the CFO of Meow Mix came by and handed me an envelope. And that envelope had a seven figure check inside of it. And it was maybe more money than I thought I might have ever had, quite honestly. There was incredible excitement around getting the check, but I swear I remember opening it up. And it was the emptiest moment maybe of my life. And I realized it wasn't about just the money. I mean, the money was about that empowerment, but it was about building something great. And I remember that so clearly. And I had become very awakened around nutrition and just thinking about what food is and a lot about the food supply.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  32. I didn't like that feeling and I had realized that along the way I started kind of awakening on my own and started thinking about like what was great food and I remember somewhere along the way someone said to me you're selling McDonald's for cats and I didn't like that I kind of knew what that meant even back at 2000 So I think it was a great brand and I think cats loved it and consumers loved it, but I just felt like it was time for me to really kind of continue to move forward.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  33. I did really do well, and it was a lot of money. And I think when I was mentioning a bit ago that when I was at Purina, one of the things that happened was it was potentially all those changes when Nestle bought Purina. It was really kind of, I thought it could impede my ability to be successful. And what I started realizing was I didn't like not being empowered. Yeah. I didn't like that someone else had made a decision that was going to affect my future and my safety and my ability to make a living for my family. And I looked at that and I said, wow, that's...

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  34. Alright, so in 2006, which was about four years after you joined Meowmix, it got sold to Del Monte for a lot of money, I think like $700 million. And you left at that time and from what I gather. You walked out of that opportunity with quite a bit of cash, right? Because you were on the... Presumably you did okay out of that.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  35. Yeah. So when I was at Meow Mix the entire time, first of all, it completely awakened my entrepreneurial spirit because there was literally no company behind it. So we had to build a company almost from scratch. I mean, it was a really wild experience because it was like, well, here's a brand. It's selling about $200 million a year. And you have to figure out how to build a company. You have to figure out how to find the people around the company. You have to figure out how to make the product over time. You have to figure out every single aspect of it. And when I walked in there, we were using ourselves. We didn't even have desk phones. We didn't have business cards. So it was a few desks sitting around in a big office space. And it was like, well, we now have to go build a company and become an entrepreneur again.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  36. People do not think about or realize is, believe it or not, it's actually the microbiome, it's actually the bacteria that pets bring into our lives. People with pets tend to have less allergies typically. But I knew that being involved in an industry that did that, that I could feel really good about being involved in it.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  37. It was. I mean, I always had pets growing up. And then when I met my wife, I met her when I was at Rawls Impurina, and she owned, she had four cats when we first started dating. And she had worked at a shelter and had an incredible heart. And she ended up taking some of these cats home that didn't have homes. And so I was always involved with pets and I love them. And what I started realizing more and more is the value that they bring into people's lives. And there was actually a lot of research that had been done that people with pets live longer and healthier lives. And there were three aspects on why they did. One of them was the emotional benefits of having a pet and having kind of someone you love in your life and caring and nurturing. People are caring and nurturing. And you get to do some of that with a pet. It's part of it's because they make you more active. And then the third piece that is...

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  38. It wasn't building affinity or loyalty to the products. And I think that was an incredible, really, really salient learning. And we kept bringing that data forward. And him and I, I'd say we were the key catalyst in really changing the way we started moving away from discounting. And it was at the time it was $70 million in all kinds of discounting and couponing. We're able to move out of those kind of inefficient activities into really fundamental brand building activities.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  39. You know, it was, I think that was traditionally how it was done. And there were me and another partner, this gentleman, Rick Speakerman, and what we started realizing was there were millions and millions and millions of dollars that were being spent in couponing and discounting that were really not very productive. They were drawing people in that would buy it once and then go back to whatever the next promotion was

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  40. Exactly. We would lay it out And I mean, I remember one time it was 3 a.m. in the morning. I'm setting a shelf and I was actually working with a nose guard from Notre Dame from another company. I think he was working with Carnation at the time. And we were kind of looking at each other going, what's going on here? It's in the middle of the night and we're setting a grocery store shelf. And we just both finished college and we're like, didn't we go to college for this? It was one of those situations where you did look around and suddenly go like, wow, we are really starting at the bottom. That's really where so much of the hard work is in so many of these industries. And I think that sometimes that work is underappreciated.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  41. Pet food and cereal was Czech cereal. There was a brand called Almond Delight. And then there were a lot of pet food brands. It was the dog chows, puppy chow, high pro, purina1, meow mix, cat chow, and the initial job was literally to get my car. And I had a little over 100 and something stores. We did a lot of shelf sets where we were setting the shelves at literally at night.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  42. Yeah, it was kind of downtown Atlanta all the way over to Alabama. So, you know, here I was this Jewish guy from Long Island driving around Atlanta and all the way into Alabama and Piggly Wigglies and all these different stores that I was, it was an incredible learning experience

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  43. So I was kind of in a sales training role when I came into the company. And the big joke from everyone else that was on the team was they had all taken the worst stores and the worst areas and through all the different other salespeople in the area. And they given that to me. And that was my sales territory. So it looked kind of a little bit like a voting district sometimes and it seems to be kind of very circuitous and a little bit all over the place. That was my sales territory. It kind of stretched all over the place.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  44. Yeah, they thought it was really reasonable. And they also knew it was a couple of college kids or at the time somewhere between high school and college at different times that were doing this. And I think people wanted to support us. And it kept growing and growing. And we kept, we were buying equipment. And I was very involved in fixing and taking care of the equipment and working with the employees. And Roger was typically the one who's dealing a little bit more with the customers

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  45. Actually, sold it for a little over $10,000. And again, it was a fair amount back then, but we had, it wasn't just landscaping. We were doing, I mean, we were doing yards every week, but we were building decks, we were building mailboxes, we were putting in brick patios and pavers. I remember one of the things that was silly, but it was kind of a breakthrough for us, was we kept putting flyers in mailboxes and we weren't getting any phone calls. And then we started putting prices on every one of the flyers that we put in mailboxes to advertise.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  46. Yeah, we had had a couple of businesses together and they were successful enough where we made a pretty fair amount of money. We had actually sold them. We had employees.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  47. Yeah, yeah, it did. And, you know, it was several years ago. But I want to say it was right around $110. And then we had kind of bells and whistles that people could add so that it would go up a little bit from there. But it was obviously you want to keep things as cost effective as possible. Yeah.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  48. We went to a lumberyard. We bought a ton of lumber. We took all of it initially and we decided we were going to use the track team locker room. We were kind of somewhat out of season at the time and we got back early in the summer and we started cutting all the pieces and we advertised that not only UNC, but also Duke and North Carolina State. We ended up building hundreds of lofts across the three schools. And we started hiring people. If I wasn't going to school or starting to train for TRAC, I was building lofts.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  49. To figure out how to make it all work. But today, fresh pet dominates the fresh pet food market. And though the company is not yet profitable, FreshPet is valued at around $3 billion. Scott Morris grew up in the seventies and early eighties in Long Island, and it was during high school that he began to lean into entrepreneurship. He started his first company with a friend. It was a landscaping business, and after he went on to study business at the University of North Carolina where he was also a star track and field athlete, and at UNC, he started yet another side hustle with a guy he knew from his track team, a business that built loft beds for other students.

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT

  50. That old cliche about if you want to make a friend in politics, get a dog? Well, let me throw out a new one. I actually made this one up. If you want to make a lot of money as an entrepreneur, sell to pet owners. In 2022, Americans spent one hundred thirty six billion dollars on their pets, and that was a ten percent increase from 2021. Think about how massive that market is. And why do we spend so much on our animals? Because we love them. My cortisol levels plummet every time I snuggle my dog Kiki or our cats million Morty. Anyway, about twenty years ago, an entrepreneur named Scott Morris started to notice a new pattern of behavior among pet owners. For one thing, they were moving away from your standard kibble and canned food. And for their cats,

    2023-10-09 · How I Built This with Guy Raz · Freshpet: Scott Morris · IDENTIFIED FROM THE TRANSCRIPT