Bespoke delivery services have long been a growing industry, but they’ve never been as prevalent as they are in 2020. People have long appreciated the convenience of having products delivered directly to their door, but it took a pandemic to understand just how vital and necessary those supposed luxuries have become. Personally, in the early days of the pandemic, my son and I resorted to meal delivery services to provide variety and in some cases access to staples that were not available in Arizona this spring.
Eating well can be a challenge even in the best of times, and 2020, with its many and varied stresses, has drained many of the will and the resources to try and cook healthy meals, to say nothing of the difficulties presented by simply going to the grocery store. That’s why it was so enlightening to talk with Michael Wystrach, cofounder and CEO of Freshly, about his company’s mission to offer quality meals directly to customer’s homes, the challenges of adapting to COVID and its increased demands, and how he parlayed his experience working at a family restaurant in southern Arizona into a service delivering millions of meals a year, based in NYC.
Mary Juetten: When did you start?
Michael Wystrach: I founded Freshly in 2012 because I had a personal mission to improve my eating habits. It started by putting meals together in my family’s Arizona restaurant, and taking orders from friends. Through word of mouth, the demand for meals grew fast. After that we moved to a production facility and began scaling the company. By 2015 we were headquartered in New York with continued growth, and we’ve since improved our product innovation, channel expansion and physical footprint. Now we’re delivering over 1 million weekly meals, and this year we will ship 50 million in total to 20,000 U.S. zip codes.
Juetten: What problem are you solving?
Wystrach: Often with food you have to give up health and nutrition for convenience, but our meals balance both. We deliver the benefits of a nutritionist and personal chef at an affordable price. Before Freshly, I spent two years doing investment banking in New York and was working long hours while eating very poorly. A longtime family friend and doctor told me to eat healthier, but cooking wasn’t something I enjoyed doing. I was looking for convenient, healthy prepared meals that also fit my busy, fast-paced lifestyle, and nothing on the market solved that. My doctor offered to make me a personal menu, and I was lucky enough to have access to my family’s restaurant. Not surprisingly, I ended up in the best shape of my life eating nutritious meals from the chefs. Now, I also realized how fortunate I was and that for many others, it wasn’t realistic at all to have a personal chef and nutritionist, so I considered how I could make healthy food accessible to others.
Juetten: Who are your customers and how do you find them?
Wystrach: We have a wide variety of customers across most demographics – anyone who wants a convenient way to eat healthier. That includes young men and women, and over the past few months we’ve seen a spike in demand from customers over 60 as well. We use several acquisition channels including TV, social media, and direct mail. Customers are also organically finding us as the pandemic changes the way we think about lunch at home – that’s where a lot of the recent growth has been, in lunch orders.
Juetten: How did past projects and/or experience help with this new project?
Wystrach: My parents were entrepreneurs so this has basically been in me since I was born. All my siblings run their own companies and I always knew I’d have my own business as well.
I had always dreamed of being an investment banker and was generally interested in all things business. When I graduated college I worked for a couple of years in mortgage investment securities and worked to eventually find a job in New York, which was almost like a business bootcamp. It was a job with long, stressful hours, and required cramming lots of information into tight windows. It’s incredible what you can learn in just two years and I believe that’s why so many successful people come from completely different fields early in their careers. It teaches discipline and work ethic, and that matters so much when starting your own business. I also learned that I wasn’t really a fan of working for corporations. I loved my co-workers but ultimately was not a “corporate person.”
I went back to Arizona to help my Dad with several businesses he ran (hotels, restaurants, gas stations, real estate) and realized the only thing harder than working in the corporate world is working in a family business. I got into real estate and eventually partnered with my parents on my own restaurant, which is where I really got my entrepreneurial chops going.
Juetten: Who is on your team?
Wystrach: Freshly now has nearly 2,000 employees across our corporate office, customer experience, production and manufacturing facilities. Our amazing team includes some of the best in the industry in nutrition, supply chain, growth marketing, and product development. We’re so fortunate to have a team of incredibly talented, passionate, and kind people.
Juetten: Did you raise money?
Wystrach: To date, Freshly has raised more than $110M to support and expand our business model nationally, with investors including Nestle, Insight Venture Partners, Highland Capital Partners, and others. We’re keeping all financial options open for our future.
Juetten: Startups are an adventure — what’s your favorite startup story?
Wystrach: Moving to New York in itself was an adventure. Coming from Arizona, it was a huge step and a daunting task to make the jump and open an office here, but it was a brilliant decision for us to grow as a business.
Juetten: How do you measure success and what is your favorite success story?
Wystrach: Adapting to the pandemic the past several months has been my proudest achievement. We stayed open as an essential service through this unprecedented, complicated time. The team did an incredible job ensuring the safety of almost 2,000 employees while boosting production 20% in under a month to meet the demand and meet an unprecedented milestone of delivering 1 million meals.
Juetten: Any tips to add for early-stage founders?
Wystrach: Do something you really believe in – that you’re passionate about, excited to build, that you believe will make the world better. Your passion will help your team through difficult challenges. It’s a mental perspective. For a hiker it’s reaching the top of the mountain. Also remember you’re a “machine” and you need to maintain yourself. Get a lot of sleep, eat properly, get in exercise time. When you get on a plane, they always say, “Put your oxygen mask on before you put your kid’s on.” You’ve got to take care of yourself first. That gives you the stamina to handle the good and the bad days.
Don’t let the little things stress you out too much and remember it’s a long game so enjoy the trip. Enjoy the people you’re around, enjoy the process that you’re doing, enjoy the outcomes that you’re delivering for your customers. Don’t anchor your success purely upon an outcome. Hopefully, that success is that even if I don’t make the top of that mountain, even if I don’t hit the highest peak, I hit the lower peak, even if I never hit a peak, it’s still a great journey, and I still got a ton out of it. If you do that, you redefine success.
Juetten: And of course, any IP horror stories to share (they can be anonymous)?
Wystrach: Not sure this is an IP horror story but in our early days we had a big potential investor make a big commitment to fund us. It was just in time as we were very low on capital! After committing, the investor went ghost on us. We could not reach him, our emails, texts, and calls were all being ignored. After two weeks he finally responded with a short email that he had changed his mind. No further explanation, no apology and we never heard from him again. It was a huge hit for us and we thought our death blow. But as luck would have it one of our first customers reached out to us unsolicited. He said he was a huge fan of our product and asked us if we would be open to letting him invest. A week later he made a huge investment and has remained one of our biggest fans and supporters. I am happy to say he did very well on his investment. Sometimes God’s greatest gifts are unanswered prayers.
Juetten: What’s the long-term vision for your company?
Wystrach: The big aspiration is to become the leading vertically integrated direct to consumer food brand. As we now deliver more than 1 million weekly meals in the U.S., we’re focused on adding new capacity to demand. We want to provide our customers with the best possible product and experience, while continuing to innovate and expand our menu offerings, driving variety and making our meals more affordable and accessible.
Thanks to Michael for taking the time to talk with me; inspiring to see how you have followed your passion. It’s an interesting industry to have insight into at this particular moment, and it’s always fun to see Arizonans succeeding. #onwards.