At the beginning, the Keiths didn’t have much besides their drive. The family of 15’s bank account? Nearly empty. The family real estate? Heavily mortgaged. Dad was sick with cancer. (“We started because we were financially in despair,” says Bill, 36, who is CEO.) All they really had was their father’s recipe for a peanut-butter-based protein bar. And everyone who knew the grocery business told them it was doomed to fail.
Sure, the Keiths’ Perfect Bar tasted great, but it needed to be kept refrigerated. That meant it would take up valuable shelf space that would otherwise go to yogurt or cold cuts, far from where Clif and Power bars typically lived. It was like asking stores to start stocking cheese alongside cereal.
Overnight or not, Perfect Snacks is most definitely a success now. The company did $84 million in 2018 sales, and Forbes conservatively estimates its worth at $300 million. Perfect Snacks’ 16 flavours of $2.49 bars are now sold in over 27,000 stores nationwide, including giants like Target, Walmart, Kroger and Trader Joe’s.
As the clan grew to 13 children, Bud and Barbara Keith bought a bed-and-breakfast in a small northern California town but still relied on Bud’s lectures to support the family. Then Bud fell ill with melanoma at 57. By 2005 it was so bad he had to stop travelling. Soon the Keiths had a mountain of medical bills and were two months behind on their mortgage, with $1,000 in the bank and nine kids under 18.
As Bud got sicker, the eldest children stepped in. Bill, then a 22-year-old junior on the basketball team at College of the Redwoods, dropped out. He was joined by Leigh, then 19, and his siblings Amyas, 18, and Charisse, 17 (now Perfect Snacks’ senior director of operations). They decided to ignore the conventional wisdom and their father’s ten years of struggles in different ventures. “Our backs were against the wall from day one,” says Leigh.
First order of business: Raise some working capital. The kids quickly sold the bed-and-breakfast, netting $100,000 after taxes. Two thirds of that went to a used candy-wrapping machine to package the bars, the rest toward organic peanuts and honey. “With all of your finances invested in peanuts and honey to the very last dollar, you sure as heck got to figure out how to sell this bar,” Leigh says.
Next, they specialised. Bud moved to San Diego, where the family was originally from, taking some of the clan with him. (He would die of his disease in 2009.) Leigh, Bill, Amyas and Charisse stayed in Sacramento, sharing a two-bedroom apartment. Bill went on the road to pitch their snacks, branded as Perfect Bars, to natural-foods stores and grocery chains up and down the West Coast. Leigh, Amyas and Charisse stationed themselves at home to make the products.
Still, by 2006, after a year in the business, the Keiths had made little headway, and they had enough cash left to fund only one more month of operations. Then, by chance, Bill met a Whole Foods store manager at a music-and-art festival in northern California. She loved it and figured Whole Foods customers would both dig the idea of a preservative-free protein bar and be curious enough to pick up one from a refrigerated case.
Perfect Snacks got a 30-day trial at the manager’s Berkeley Whole Foods. Bill was the in-store pitchman. With no money for a hotel, he lived in his car for a month, showering at a gym. Perfect Snacks sold $20,000 at that Whole Foods in a month, more than it had in the past six months combined—and enough for Whole Foods to expand Perfect Snacks to ten more northern California locations. “That was the match that started the wildfire,” Bill says.
Revenue hit a million dollars two years later, and soon a Costco deal followed. Then sales really took off after a cash infusion from the 2015 VMG investment allowed Perfect Snacks to place bigger orders from contract manufacturers and, in turn, take larger orders from grocers.
“We have the story, the product and the people that can really build this to be a household name and become hopefully an iconic brand for generations,” Leigh says. “The rolling pins are gone. We’re just getting started.”
First Published: Aug 19, 2019, 14:54
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