Sometimes You Need Millions of Dollars to Grow a Start-up
In 2009, in order to build her organic baby food company, Shazi Visram raised $11 million--fast. Last year, HappyFamily Brands's sales hit $35 million.
00:08 Shazi Visram: I was so broke that I remember standing on, going down to the High Street Station to catch the C train to go back to Jersey City where I lived. And my credit cards were all so maxed out that I could not buy one single swipe on the subway. I didn't have... Literally, that's how broke I was.
In 2006, Shazi Visram started Happy Baby, an organic baby food line.
To grow, the company needed a lot of cash.
00:39 Visram: Started raising money in 2006, raised maybe 550 K, then another million to keep going, launched a frozen line, struggled because the dream was a big dream and the frozen line sales were not representative of building that big dream. And one day I wake up and I realize that we finally have it.
The company created a squeeze pouch to replace its glass jars, but needed more money upfront to manufacture.
01:07 Visram: Others were very quick to follow, and some of those others had very deep pockets and some recognition on shelf as it stood. So, it was really, really hard to get in front of these buyers and convince them to take our brand. Because if they were already selling a bunch of jars, they weren't gonna take all the jars off their shelf. I was worried and I was like enervated. Like the thought that we've been in this for so long and this is my baby and my baby is flourishing, and now this is its chance to really have an impact.
01:37 Visram: So, I had to work on raising money. And this time, it wasn't $1 million or $2 million or even $3 million that I could cobble together from a number of investors. This was in the $6 to $10 million dollar range, which was a big deal for us, and we needed it fast. And I guess as luck would have it, we were in this position where as soon as we launched these pouches on Target shelves, and it was one of the first... One of the first few retailers that we launched them with, within two weeks, we had the number 2, 4, and 6 selling item in the entire baby set in Target, in two weeks. Just having that data point was so useful to go out and start pounding the pavement and talking to people and finding other... Using my network to then reach out to bigger players.
Happy Baby raised rounds of $3 million and $8 million and manufactured 15 million pouches.
In 2011, it debuted on the Inc. 500 list at No. 68. It has grown 1,772% in the last three years.
02:37 Visram: Sometimes there's a lot of luck involved, but sometimes it's just about going out there, pushing and continuing to try even though you don't see any light at the end of the tunnel.