Recently, our founder Kate was interviewed by Katie Wyatt from The Wellness Entrepreneur. Speaking so honestly and openly, Kate reveals the story of KOJA- how she built the business from the ground up by herself, how both the business and herself have grown, and the things she's learnt along the way about becoming a successful entrepreneur.
Check out the transcript from the podcast below:
If you want to listen to the audio - just search 'The Wellness Entrepreneur' on Itunes or your podcast app- it's episode 15 and the interview starts at about 9mins30secs.
TWE: Kate Johansson from KOJA, welcome to the Wellness Entrepreneur! I’m so glad I’ve got you on the show, obviously I saw you on Australia’s Shark Tank a few weeks back and of course I want to ask you about that straight off. So, what on earth made you think “yea, Shark Tank is absolutely where I need to be”?
Well, it wasn’t actually Shark Tank when I discovered it. It was September last year and I saw an email pop up somehow, talking about whether or not I needed external investment. I was at the point of the business where I was about a year in, doing it on my own, and really needed it to grow in order for it to be successful, so I thought that external investment would be a great way to do that. So, I had a look and a 10-minute online application later, I'd applied. I don’t think I even knew it was Shark Tank at that point, I think I knew it was a television program. I was familiar with Dragon’s Den, so without really thinking about it too much I just hit 'send' and a couple of weeks later I got a callback to come in and do a casting. It was really quick and easy, and then another few weeks later I was up in Sydney filming.
TWE: So you filmed it but then it probably wasn’t on TV for months then, is that right?
Yes, exactly. I filmed it in November last year, and it didn’t air until May, so definitely a long lead time.
TWE: Oh wow! Obviously it’s so exciting, and I can tell from your website and even just from us trying to set up this interview that you’ve just been so busy since it aired, which is fantastic, and I will come back to it but it’s really important to me to share your story and all the hard-work that came beforehand. Shark Tank made you look like you had it all together, which is fabulous, but if we can go back even before 18 months, which is how long you've been in business for, have you always been a bit of a born entrepreneur?
I think I’m definitely an entrepreneur. I don’t know whether I was born or raised that way but my dad’s always had his own business. I’ve always been a problem solver- which probably makes me an entrepreneur. I don’t really know.
TWE: Yes, a problem solver is a pretty big part of being an entrepreneur!
I’m definitely an entrepreneur now, and I think I would struggle now to be otherwise. I would like to be able to work within an organisation at some point in my career, though, I don’t see myself doing KOJA until I’m 95. But for me, entrepreneurship is a way of thinking and I think that once you’ve done business with that way of thinking and attitude, it’s really difficult to then work in organisations that don’t have the same mindset.
TWE: That’s so true. And so when you decided to start KOJA, what was your big vision? Where did you see it going?
I knew that I had a pretty delicious mix of nuts and seeds. It started with one product, KOJA Daily, which is now renamed to KOJA Almond & Berry. It was about 6 months after I got married, and there were all these personal reasons why I changed the way I was eating- I was trying out vegetarianism, and trying all these different ways to find a balance in my diet. I was also working in the supplement industry, but for me, supplements aren’t the answer. For elite athletes, perhaps, but for most of us who just want to be fit and healthy and just have the energy to go about our day, I don’t think we need to be taking all these artificial supplements. So, I got to the point where I had a product, and then almost built the vision around the product- once I’d realised that the product was pretty damn delicious, and that that was what I wanted to do. So I think the vision has really developed over the past 18 months. I’ve learnt more about what I believe is important in not only in regards to our health, but in regards to life as well, and I think the two are so closely related. So in terms of the vision now, it’s more about education, and helping people to be healthy so that they can then do other things in their life, it’s not just about eating nuts and seeds.
TWE: So 18 months ago, you decided to start a product-based business. I’ve had a product-based business myself and I know it’s no small feat to just take something you’ve just made in your kitchen and turn it into a beautiful, packaged product. So how did you start, and do you still make the product yourself or do you get it done in a kitchen? And at what point in the process did that transition happen?
I started out actually at my locally community kitchen, I was able to rent the kitchen there. I started working with a local health food store that was happy to help me out with some wholesale prices on the nuts and seeds that I was using so I could start making samples. From there, I went to some of the bigger suppliers in Melbourne, and started upping the volumes and I was making and packing it into little craft paper bags. I wasn’t able to do it at home because you have to have a registered kitchen, so that's why I was doing it at a local community kitchen. And after about 4 months I was spending about 3 full days in the kitchen there, and then the other 4 days of the week I was selling it and working non-stop. I went to RMIT here in Melbourne, and I actually ended up at an alumni group, and someone knew someone that had a kitchen in Geelong that was doing similar contract manufacturing, so it was just through networks that I was able to meet the team down in Geelong, who I’ve now been working with for 18 months. They took over the manufacturing for me, and now just in the last 4 weeks I’ve started with a second manufacturer. Just after the Shark Tank buzz we needed to find a larger facility pretty quickly.
TWE: That’s amazing! When you say you went to bigger suppliers, how did you find them? I found that when I was looking for suppliers in Melbourne, that it’s actually quite challenging, they’re not always out there on the web promoting what they do, it seems to be more based on networks and other ways of finding them. What did you find?
Definitely, I completely agree. I remember walking down strange laneways in Brunswick, looking for a shop that apparently sells almonds and just having to keep asking and asking. And when people say 'no', never really accepting ‘no’, but just saying "ok, do you know someone who might be able to help me? Here’s my business card, would you be able to keep me in mind?"
TWE: That’s brilliant. Isn’t it funny, for anyone who’s not from Melbourne, Brunswick’s an inner city suburb, North of the city, it’s the heartland of healthy food supplies. So with the packaging, you said you started with the craft paper packaging that you did yourself, and now you’re packaging is beautiful, colourful and you use different colours for different products, and you even have the window in the front so you can see the beautiful product inside. How did you end up sourcing those?
That was something I did quite early on because I thought there are so many different products in this health food space, and so many of them are just in brown paper bags, or what I consider to be really plain and boring packaging. Design is something that I love, and I wanted to really stand out from the beginning, so it was something that I invested in early on. A friend of mine actually helped me out with the design, and all my packaging is still printed around the corner in Port Melbourne. I worked with a company down there, and again, it was just about knocking on the door and finding one person who was willing to give me 20 minutes of their time so I could tell them what my problem was, and whether or not they might be able to help me. I’ve been working with Frank down in Port Melbourne now for 18 months and he’s been great helping me out. Even with the original die cuts for the packaging, I had no idea about, and it’s just about finding someone who’s willing to give you a bit of their time and point you in the right direction I think.
TWE: There’s such a really good theme with you here about getting out there and not being afraid to ask. And I love what you said about prioritising the packaging early on. I think when we’re starting out we’re trying to be low-cost and there's definitely some things that don’t need to be top notch from the outset, but packaging, I think you’re right, to really differentiate in a crowded marketplace, I think that’s one of the few opportunities you have. How did you launch? Was it sort of a soft launch, did you just start selling online or was it another way?
We did a bit of a soft launch with one product in those brown paper bags early on, and that was just a one or two-page website. I just put it out there to friends and family and said “hey, this is what I’m doing, if anyone’s interested, check it out” and that was just a distraction while I kept working on everything else that needed to happen, such as the proper packaging that we were using. Once we did get that packaging I actually probably launched at a farmers’ market, whether that was planned or not. I think I picked up the packaging on a Thursday and I had my first farmers’ market on a Saturday. I took down way too much stock to my local farmers’ market, I thought that people would be lining up to buy it, and it did go very well but I took down hundreds and hundreds of boxes, not really knowing how much I was going to sell, and just launched there. I invited my friends and family to come down, it was a local farmers’ market so it was great to be able to see lots of friendly faces coming up and having a look at what I was doing now.
TWE: That’s a great strategy. Do you still sell at farmers’ markets? Probably not after Shark Tank!
I do. My last farmers market was the day before Shark Tank, and before all of the success from Shark Tank I already decided that I wasn’t going to do farmers’ markets in the Winter. I think anyone that’s ever been to a farmers’ market, let alone had a stall there would understand that they’re pretty miserable in Winter- it’s wet and cold, you’ve got to stand outside for sometimes 6 or 7 hours at a time, and you just don’t do enough sales to justify the whole day. I love farmers’ markets, I love being able to stand there and chat face to face with my customers and talk about everything as well, not just KOJA. Farmers’ markets have got such a good vibe that it’s a really enjoyable place to be and it always leaves me feeling inspired, and you never know who you’re going to meet. So I think leading up to Summer and Christmas, I’ll make sure that I can fit a few in my calendar this year again.
TWE: That’s great. So you were going to the farmers’ markets and you were selling online, at what point did you start selling through retailers?
I had a local health food store and one day I was just feeling overly confident and I walked in there and said “would you like to stock it?” and to my utter surprise they said yes! They asked me to send through my pricing, so pretty quickly I had to work out what wholesale pricing should be, compared to retail pricing, and other things such as what other sorts of terms I needed to include. The thing that all entrepreneurs want to do is sell it first then build it later, and even though I already had the product I worked out how wholesale worked after I’d already got my wholesale customer.
TWE: How different have you found wholesale to retail?
Wholesale’s really interesting because you have to sell it twice. For me, I’ve got to sell KOJA twice- to the local health food store owner, or the independent supermarket that wants to buy it- I’ve got to convince them that their customers will want it, but then it’s sitting on the shelves and I’ve got to sell it again to the end user. I’ve got to do whatever I can to make sure that the person who comes into the store wants to actually buy KOJA and take it home with them, so that’s a challenge that’s really hard to do on a small budget. Obviously big companies do that really well, but on a very, very small scale, that’s something that’s challenging and often takes a lot of time. For me, I got into Leo’s Supermarkets, which is a chain of stores down here in Melbourne that have 4 stores, and I don’t remember how I originally got in touch with them, but I had a meeting with the buyer and they said yes, and I got it into all of their stores and I thought “this is going to be fantastic!” Then after a month I realised it was selling but not anywhere near what I expected, so then you’ve got to go back into the store and spend every Saturday for 2 months standing in a supermarket saying “hi, would you like to buy KOJA?” Then it does start to move and that spiral effect begins, but I think I probably underestimated how much work is involved in building up a customer base when you don’t have a budget for marketing. I did it all myself, basically standing in supermarkets- that was pretty much my strategy!
TWE: That’s great though because you’re right, you’ve got to do it on a shoestring when you’re starting out. Did you do any advertising or have you really just used your face-to-face to build awareness of the blog and the website?
I have done some advertising across the past 18 months but I really didn’t have the budget for it. Any marketer would know that when you spend money on a campaign or an ad, a lot of the time, especially if it’s a new business, you’re crossing you’re fingers that you are going to get a return on an investment, and as a brand new startup, it’s really difficult to find the funds to do that, to just spend it and hope that something will come back. So, what I did in terms of advertising marketing in the first 18 months was a lot building on personal networks. In Melbourne, and I’m sure in Sydney as well, there’s a great community of health and wellness warriors, so I got out there and just spoke to as many people as I could, and I went to events and handed out samples and I sponsored events. Things that didn’t cost too much money but probably cost quite a lot of my time, but time is something that you have when you’re just starting out a business, so I just used that instead of the cash that I didn’t have.
TWE: That’s great. So what are some of the health and wellness events that you went to?
They’re popping up all the time. I went to a few creative mornings, one down here in Melbourne that aren’t specifically focused on health and wellness, but every now and again they do one that’s well focused. I work at a co-working space in Richmond called Inspire 9, it’s a great space and there’s always events happening there, and every so often there’s a health and wellness one.
TWE: Fantastic. I think it’s such good advice, that if you really want your product to succeed that you can’t hide behind a website if you really want to build that awareness, you’ve just got to get out there and put yourself out there, I think it’s amazing how you’ve done that!
I think it’s something I’ve really just learnt over the past few weeks after Shark Tank as well, I never wanted to be the face of KOJA, and I still don’t really want to be, but I think what I’m realising is at the moment in our food industry and everything that’s going on in our food supply in the world, I think people want to know who’s making everything that they’re buying, not just food. We want to be able to know what’s happening behind the scenes, and can we trust this company? Are they are who they say they are, or do they just have this huge marketing campaign that makes them look like something that they’re not? Shark Tank was an amazing opportunity, but I think I need to learn to do this more often now, to stand up and say “this is what I do, I love nuts and seeds and healthy foods and I’m dedicating my life to sourcing all these amazing products and getting them out there” and if that’s something that my customers can relate to and benefit from, then it’s a win-win situation for everyone.
TWE: That is so awesome. You do have your photo on the homepage on your website, so is that something that you were advised to do after Shark Tank?
Not so much advised to, but I realised in the lead up to the show being aired. I filmed Shark Tank, and then I watched quite a lot of the episodes air early on the season this year. I watched a lot of the other entrepreneurs and I noticed that a lot of the time the camera was right up in their face, not so much on their products, business, or logos and it was a lot of the entrepreneur. So in redesigning my website in the weeks before my episode aired, I wanted to capture that. I thought hopefully there will be hundreds of thousands of people that are going to be sitting in their living rooms and my face is going to be up on their wall, so I wanted them to then link that once they arrived at my website, and carry on the journey and know that 'yep, great, you’ve seen me on TV but this is everything else I’m trying to achieve with the company and the products and what I want to do with KOJA'.
TWE: Cool! So before you started, how much planning did you do into thinking about the product, your ideal customer, how you were going to sell, putting numbers into a spreadsheet about what you thought you might sell, what it was going to cost- did you do a lot of that or did you really just get started?
A bit of both. I think you’ve got to just get started and then keep doing the planning as you’re going. The planning is really important but I think it shouldn’t delay getting started because a lot of the costs of the product, I would have no idea what they were going to cost early on, and so there’s no point spending 3 days creating some crazy P&L (profit and loss) if I don’t really know what my figures are. I’ve got a very good friend of mine who’s name is Adam and he’s got a marketing agency called Flux, so I bought him a lot of coffees and had a lot of long chats, picking his brain and talking through it. So I think the best thing I did early on was find someone who was like-minded and entrepreneurial and believed in the vision of what I was trying to create, and just talked through it with absolutely anyone who could listen. And I got a lot of advice, not just from Adam, but from other people, and you get some advice that you think “ok, that’s their opinion and I’m not going to take it onboard”, but you do just get a lot of really good advice, and people asking questions, making you think, and you can’t just do it on your own. You can’t just sit at home and have an idea and build a website and make it happen- I’m sure some people do start businesses like that, but for me it was more about just talking through all the different ideas and using the people around me to be inspired and to clear my thoughts and get some clarity and inspiration about what I want to do next.
TWE: I did want to ask you, because a lot of the solopreneurs that I coach often get to that point in their business where they really struggle because they’re on their own, and I do see that when there’s a couple of people cofounding something together, it’s often a slightly easier ride because you do have that person who probably compliments your skill set, and there’s someone that’s sharing the journey with you. You’ve said a few times that you haven’t had that, but what I’ve observed is that you’ve almost created that informal network of advisors for yourself. But have you ever really stopped and thought “I can’t do this on my own?"
Definitely! As anyone who has ever started a business knows, it’s really hard. I went from working in an office with 100 people and having smiling colleagues everyday, to really just waking up and staring at the 4 walls of my living room where I’d tucked a desk in the corner and decided to work from home for a few months, and you do go crazy, it’s really hard. There were many, many times where I wished I’d had a cofounder, but I think that’s one of the hardest things to do, to find the right cofounder. Starting a business with someone else, it needs to be someone you can trust, someone who’s got complimentary skills, someone who’s got the same vision as you, and I just didn’t ever find anyone who was going to be the right fit, so I thought “ok, I’m doing it on my own”. To try and combat the loneliness and the days where you think “what am I doing, I should just go and get a job”, I did start working at a co-working office, and that was probably the best decision I ever made because it means you wake up in the morning, you’ve got somewhere to go that’s out of your house, and then you’re around other people who know exactly what you’re going through- everyone’s lonely, everyone thinks they’re crazy, everyone’s broke, but at the same time we’re all trying to start businesses for another reason, and it’s great to be around like-minded entrepreneurs.
TWE: I know co-working spaces aren’t very expensive, but it’s an interesting point to pose, when people are starting out and they’re not yet making money or a profit, it’s really hard to choose the right things to invest in, and obviously a co-working space was something that was really worth it for you. Are there any other things that you chose to invest in, even though you probably were thinking “I shouldn’t be spending money yet”?
Lots of things! I think even now, looking at the last few weeks after Shark Tank, I’m hiring staff before I'm paying myself. I’ve gone from 6 weeks ago, I was the only person working full-time in the business, and now it’s Friday and we’re going out for Friday night drinks, and there’s going to be a team of 5 or 6 of us, which is just crazy and really hard to believe for me! But I’m looking at what the business needs and I’m deciding to pay staff over paying myself. I’m paying myself a very minimum wage every second month, and just prioritising staff. It’s more just about looking at what the business needs and what’s going to provide growth. I think the co-working space is a very good example of that. I looked at the few hundred dollars that I was spending every month on an office and thought “that could be extra money towards food or rent”. I just found I worked so much better when I was in an office around other people.
TWE: Have you been full-time on this the whole 18 months?
Not really, I started out and I was still working a couple of days a week. The role that I had before I started KOJA was as a marketing consultant, so I kept a few clients that I worked with on more of an ad hoc basis, and then I went full-time in January 2014 and pretty quickly started to realise that I couldn’t pay the rent, so went back to work around April, just working a couple of days a week to bring some money in. Then in August last year, my decision to pick a couple more days work was more a mental sanity thing, I’d just been working on my own for too long and everything that I was doing was based around KOJA and I was just so involved in KOJA and working on my own that I needed to get out there and get inspired. I ended up working with a cold press juicing company called Green Press, and started working with them for a couple of days a week. Again, just great to be around like-minded people who are trying to achieve something similar to yourself and it’s amazing how much inspiration I drew from working with them, and also it gave me a little bit of income while KOJA was growing.
TWE: Lots of my audience are grappling at the moment with the decision of whether to just resign or to start on the side of working. How have you survived since then without paying yourself? Do you just have a very kind husband or is it savings? Were you prepared for this period of time where you wouldn’t be drawing a salary?
I did save a lot leading up to quitting, so probably 6 months before I quit my full-time role I cut out all extra expenditure and started saving, so I knew that it was coming. At the same time, when you go from having a full-time salary to having no income, it’s really hard to understand how quickly the money runs out. So for me, it’s just been about finding other ways to make money. The farmers markets have been something that keep me going because there’s always a farmers market on every weekend, so I know that if my car registration comes up or I need to pay a big bill, I know I can do a few extra farmers markets and earn some income. Otherwise yes, I do have a very supportive husband who’s helped out with paying our rent and things like that, whilst KOJA’s had some bad months.
TWE: That’s awesome, and I think even though you’re doing it on your own, you’ve obviously got lots of support around you, which is so essential. If I come back to that moment on Shark Tank- firstly, you got floods of interest afterwards from people coming to buy from you because they’ve seen you on the show, and you also got investment from John McGrath, so how does that work? What’s his role and what are you using the investment for? I imagine it’s possibly for paying your new staff!
Actually, with Shark Tank being filmed last year in November, a lot has changed since then. I started working with John from January and went up to Sydney a couple of times and started strategising about how to grow KOJA. But quite quickly I realised that I really needed someone that was a bit closer to the business, so with me being and Melbourne and him being in Sydney I found it really hard to get enough support. I just started to ask myself “if I am going to give up almost half my business that I’ve worked my butt off for, then what kind of support do I expect in return?” and I just wasn’t getting it. I have no hard feelings towards John at all, I’ve turned down the investment now so we’re no longer working together as business partners and I’ve managed to maintain 100% equity, and I’m now working with John as more of a mentor, so he’s stayed on board and I hope to be able to catch up with him for a coffee, but we’re actually not working together as business partners anymore.
TWE: Ah, that’s amazing! I really admire your decision-making process and the fact that you tried something and you realised it wasn’t working for you, and the courage to say no to that. So does that mean that all the growth you’re experiencing, you’re just managing all of that on your own?
I hate to say on my own because there are so many people who are involved, but essentially yes. Down here in Melbourne I’ve got a mentor, Keith, and he’s got a finance background and has been helping me out with those decision-making processes and where to focus on the business and what I should be focusing on each week and month, just making sure I'm on track, so that’s been great in that sense. And then now I’m at a really exciting point where I’m able to hire staff who are able to support me in so many different ways and to help me grow the business, so I’m definitely not doing it on my own.
TWE: So, what was the first staff member you hired, what skill?
Not the very first staff member, but the first long term hire is a girl named Heidi. She’d just moved down to Melbourne from Sydney and sent me this lovely email earlier in the year saying “I’ve seen KOJA, I love what you’re doing, I’d love to catch up for a coffee with you and hear about your business and if there ever was an opportunity to work with you I’d be really interested.” At the time I wasn’t hiring but kept it in mind, and then a few weeks later I wrote back to her and said “let’s catch up for a coffee”. And it was one of those things when I honestly thought the stars aligned! We had a coffee and ended up chatting for an hour and a half and she’s just an absolute legend. She’s come on board and she started about 10 days before Shark Tank- we were all organised and had everything ready, I was training her and thinking I would have her in a marketing support role, and then Shark Tank hit! Pretty quickly my business went into overdrive and Heidi’s role became ‘do anything that needs to be done’, so over the last month she’s had the perfect introduction, which has been anything from: helping out in the new kitchen one Saturday night with hairnets on mixing up KOJA and actually getting into the commercial kitchen and making it ourselves, packing and sealing bags, folding boxes and date-stamping, all the way through to when I’ll be trying to make the biggest decisions about where to take the business next and I’ll be saying “Heidi, what do you think, I can’t make this decision right now, can you just make it for me?” So I’ve just found it’s not necessarily a specific role that I’ve hired for, it’s more just the person. She’s got that entrepreneurial flair, the ability to learn really quickly and solve problems, so I never really hired for a role, I just found the person and the attitude and hired for that.
TWE: Oh, that’s a brilliant piece of advice, brilliant! It’s so true, especially when you’re small, there is no single focus in a job, I think you’ve got to do so many things and be so flexible. So Kate, what are you most proud of?
So many different things! That’s actually a really emotional question because the last month has been so overwhelming. I think for the first 18 months of KOJA, it was really hard and it’s still is really hard and we are still a really small business with a lot ahead of us, but the last month has been so humbling. It’s been literally hundreds and hundreds of people that have contacted me or stopped me in the street even and said "congratulations, we love what you’re doing, we love your products!” and just to finally get that reinforcement that what I’ve been doing for the last 18 months is actually worthwhile and someone is getting something out of what I’m doing has been such an overwhelming feeling. I’ve had a few people email me and tell me their stories about different health challenges and just knowing if I can inspire someone or make healthy eating slightly easier or encourage someone just to go for a healthier option- even if it’s not KOJA, I don’t even mind- if it’s the healthier option, I feel like I’m doing the right thing and I feel like that’s the thing I’m most proud of, that I can inspire someone out there to be healthier.
TWE: That is such a good way to end this interview! Thank you so much, I think your story is so inspiring and there’s so many good messages in there about all the things that you’ve done to actually make things come together for you. I know you feel like things have probably just happened in this beautiful, random pattern, but I don’t think without your attitude, I don’t think any of it would have. Thank you so much for coming on the podcast today.