A true American dream. How 13 siblings built a business on $ 300 million on dad's recipe

The large family Keith decided to start a business when her bank accounts were almost empty, real estate was taken as a mortgage, and the father of the family had cancer. Now their company, producing protein bars, costs $ 300 million, writes Forbes.

Perfect Bar Team Photos: Facebook Perfect Bar

Lee Keith slowly rolls a lot of peanut butter, honey, cranberries and chocolate chips with a wooden rolling pin, and then cuts the resulting layer into ten-centimeter rectangles. Previously, she did it much faster.
14 years ago, when the Keith family had just started selling peanut butter protein bars, she and her siblings worked all night to handle all the orders.

“We didn’t even have a written recipe,” recalled Keith, 33-year-old.

Her wavy light blonde hair (like almost all members of the Kit family) has her hair tucked under a hair net.

“When we started producing bars, we were full of energy. The more we worked, the more we invested in our business, the more opportunities we had to take the destiny into our own hands. ”

Difficult start

At first, the Keith family, consisting of parents and 13 children, had almost nothing but enthusiasm. Bank account? Almost empty. The property? Mortgage taken. My father was sick with cancer.

“We started a business because we were completely desperate because of financial problems,” says Bill Keith, CEO of Perfect Snacks, 36-year-old.

He and his brothers and sisters had only a recipe for protein bars with peanut butter, which their father Bad Keith had long ago invented. In addition, everyone who understood at least something in this kind of business told them that their undertaking was doomed to failure.

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Perfect Bar protein bars really were very tasty, but they had to be stored in the refrigerator. This meant that in supermarkets they would occupy such a valuable place on the shelves of refrigerated cabinets, which could be set aside for yogurt or cold cuts. At the same time, bars from other manufacturers were usually sold in completely different departments. Placing a Keith family bar next to other protein bars would be as stupid as selling cheese in a cereal department.

“Few entrepreneurs started a business to save their family from starvation,” said Wayne Wu, a partner at San Francisco-based private equity firm VMG, which became an investor in Perfect Snacks in 2015. “Now this is a story about the real American dream.” However, success certainly did not come to them overnight.”

Overnight or not, today this company has definitely achieved great success. The sales of Perfect Snacks for 2018 a year were $ 84 million. Forbes estimates the market value of a family business at $ 300 million.
The company produces protein bars with 16 different flavors. They are sold for $ 2,49 in more than 27 000 supermarkets across America, including major networks like Target, Walmart, Kroger and Trader Joe's.

Keith's mother family Photo: Facebook Perfect Bar

Bad Keith came up with a proprietary recipe for protein bars back in the 1990s. He worked in the office and sold the juicers of Jack Lalane, an American TV host and fitness guru. He then decided to quit his job to become a promoter of a healthy lifestyle and seller of food supplements. The work involved frequent departures, but Kit did not want to be separated from his wife and children (there were seven at the time). Therefore, the Kit family went on a long journey in the Dodge six-meter trailer. It was at that time that Bad Kit came up with a recipe for peanut butter bars. To make them more nutritious, he added protein powder to them, which he was then selling. Sometimes his children sold these bars on the street to earn their pocket money. In one particularly successful year, they earned about $ 2200 from selling them. With this money, the Kit family went to Disneyland. Bad Keith also occasionally put candy bars in order boxes as a gift to customers.

When the thirteenth child appeared in the family, Bad and Barbara Keith bought a small hotel in a town in northern California. However, they were still financially dependent on the healthy lifestyle lectures Bad then read. When he was 57 years old, he was diagnosed with skin cancer. By 2005, the disease had worsened so much that he had to stop driving to different cities with lectures. Soon, Keith's family had a mountain of unpaid medical bills. In addition, they have delayed payment on the mortgage for two months. Only $ 1000 remained on their bank account, and nine of the thirteen children were minors.

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When Bud Kit's health deteriorated, the older children had to take care of the family. 22-year-old Bill Keith, who was studying at Redwoods College at the time and successfully playing in a basketball team, had to drop out. 18-year-old brother Amias, 19-year-old sister Lee and 17-year-old sister Chariss (now she is the senior operating director of Perfect Snacks) helped him to open the business. They decided not to adhere to the traditional approach to entrepreneurship and forget that their father, 10, had unsuccessfully tried to open a business for years.

“We were in a difficult situation from day one,” recalls Lee Keith.

The first rule of business: you need to attract working capital. Bill, Amias, Lee, and Charisse quickly sold the hotel. After paying taxes, they have $ 100 000 left. Two thirds of this amount went to the purchase of used equipment for the packaging of bars. The rest is for the purchase of peanuts and honey.

"When all your money went to the last cent to buy peanuts and honey, you definitely need to figure out how to sell these bars," said Keith.

Then they focused on business development. Bad Kit, along with some of the children, moved to his hometown of San Diego (he died of cancer in 2009). Lee, Bill, Amias and Charisse stayed in Sacramento. They lived together in a two-room apartment. Bill Keith traveled throughout the US West Coast and advertised Perfect Bars protein bars in organic food stores and supermarkets. Lee, Amias, and Chariss were responsible for their home production.

The spark that started it all

By 2006, the Kit family had not made much progress. A year after starting a business, they had only a small amount left that would have been enough to finance only one month of work. Then Bill Keith went to the music and art festival in northern California, where he accidentally met the manager of the Whole Foods supermarket, who really liked the company's product. She felt that the customers of the Whole Foods supermarket would like the concept of a preservative-free protein bar so much that they would approach the refrigerator and buy at least one package.

Thanks to this, Perfect Snacks got the chance for 30 days to sell their product at the Whole Foods supermarket in Berkeley. Bill Keith worked as a promoter in the supermarket. Since he had no money to rent a hotel room, he spent the whole month in a car and took a shower in the gym. This month, Perfect Snacks' sales totaled $ 20 000. This amount was more than the company's total revenue in the previous six months. In this regard, the leadership of Whole Foods has decided to put Perfect Snacks protein bars for sale in ten more stores in northern California.

“It was the spark that started it all,” recalls Bill Keith.

Bars that should become cult

Two years later, Perfect Snacks revenues increased to $ 1 million. The company then signed a contract with Costco's self-service warehouses. In 2015, Perfect Snacks raised funding from the VMG investment company. With additional investment, the Keith family was able to charge larger protein makers with protein bars and, in turn, receive larger orders from supermarkets. Then the company's sales really began to grow.

Bill Keith with his family Photo: Facebook Perfect Bar

When starting a business, the Keith family, which still owns a controlling stake in the company, risked everything. Now the management of Perfect Snacks has chosen a more cautious strategy. Instead of launching completely new products in Perfect Snacks, they created a line of small protein bars, Perfect Kids, which fit in school lunch boxes, and a line of Perfect Bites chocolates, sold in containers with a lid.

“They are really focused on business development. Many such companies are achieving some success and are starting to launch many completely new products, ”said John Foraker, the former CEO of Annie's, which produces organic pasta.

According to Keith’s family’s forecasts, by the end of 2019, Perfect Snacks’s sales will reach $ 130 million. Therefore, the company’s management is looking for new refrigerated cargo vans for inexpensive transportation of goods. Due to the growing demand for fresh food, the number of truck drivers has decreased, and the price of freight has risen.

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In addition, the Perfect Snacks guide is trying to convince supermarket owners that the refrigerator with their protein bars should stand elsewhere. Now Perfect Bar bars are mainly on the shelves of refrigerated cabinets in dairy products. However, entrepreneurs want them to be sold in small refrigerators near the cash register. It is in these refrigerators that one can see the energy companies of Red Bull.

“We have an extraordinary story, a great product and people who are willing to work hard to make our bars iconic for generations,” said Lee Keith. — The time for rolling pins is over. But we're just getting started."

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