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Gary Nowacki: So you’re in a category, crowded category. Beverages is crowded.

Rod Johnson: Very crowded.

Gary Nowacki: Yeah, yeah, exactly. Coffee is crowded, tea is crowded. How do you stand out?

Rod Johnson: I would say one, again, being a social impact company, that’s something that is a huge differentiator for us. Two, it’s to be innovative. So, when you think about our product portfolio, it spans across however people can sell their coffee outside of a coffee shop. So, we have our core, our base, which is our bag of the coffee, your beans and your ground coffee.

We partnered with- We took a couple of different steps in some different directions one was to release our individual cold brew cans. So cold brew is the fastest growing segment in coffee, and we have Gen Z to thank for that. They love their energy, and they love convenience. So cold brew is something that checks off a lot of boxes for them and last summer we released four flavors of cold brew that not only are highly caffeinated, but they’re also low in calorie intake. And so, when you compare them to a lot of sugary energy drinks out there, this is a healthy alternative that consumers can consider. So that’s one innovative product that we were able to bring to market.

And then another that isn’t necessarily innovative on the surface, but if you peel back a few layers, you’ll see why we did it. And that’s the release of our Keurig K-Cup pods. Now, K-Cups dominate the single serve coffee industry. I think that they account for like 60, 70% of all market share, single serve market share that is, but they don’t have a ton of specialty coffee brands in their portfolio. What do I mean by specialty coffee? Similar to wine, coffee is graded on a scale from 1 to 100 by the Specialty Coffee Association. A bunch of smart people get in the room, they sit around at the table, they bring out their grading rubric, and they taste the coffee, similar to like a sommelier wine. And they’ll grade it based on its aroma, based on what it tastes like at different boiling points or different brewing points, if you will. And from there, it’s then scored, again, 1 to 100.

Anything that receives a score from 80 to 100 is deemed specialty coffee. And this is what you typically find in coffee shops, right? You’re more niche, you’re more nuanced, coffee shops if you will. And I say all that to say, that’s the type of coffee that we source, our formal name is BLK & Bold Specialty Beverages. And the fact that we are now taking that very niche product, specialty coffee, and then pairing it with the largest, single serve avenue that’s another way to bring more people into our ecosystem you know who may be a bit afraid of traditional brewing methods. You can now press a button and still get coffee house quality coffee at your home essentially. So, you know being innovative in those regards help us to stand out among the very mature industry that is coffee.

Gary Nowacki: So, I just learned something. I had no idea that it was like a wine weight rating for coffee, you know, zero to a hundred. I did not know that. So now I got to ask a follow-up question, which is, you know, if you buy wine, not always, but frequently you will see, you know, this scored a 91 or this scored a 93. That’s why you ought to buy it. I don’t recall ever seeing that on coffee. Is that done in the industry or?

Rod Johnson: It’s not really prevalent. I mean there may be a few specialty coffee brands that do that and maybe even some coffee shops that will boast the type of coffee that they have available but it’s not uh… something that is marketed because a lot of people don’t know about it right? They’re like, “What does this score of ninety one mean?” It’s not uh… you’d have to be some level of education to the consumer so that badge can then have some credibility. If you are interested, the information is out there. The Specialty Coffee Association has resources upon resources and years of data that you can look into to find out where your preference, where that lies on the specialty coffee spectrum.

Gary Nowacki: Would you ever think about putting it on your label? This is our rating. Yeah.

Rod Johnson: It’s something that we have considered. It is something that we have considered. Again, there’s a level of education that we need to deploy first, but that is, it’s in our back pocket.

Gary Nowacki: Yeah, cool. Cool. So, you know, I saw some of your bags of coffee were branded with, you know, Marvel Comics or the NBA. And I understand maybe you’ve branded some things with keto as well. Is that true?

Rod Johnson: Yeah, our keto friendly cold brews, that is, right? So, they have zero sugar. There’s a naturally occurring sugar, allulose that we use to sweeten it, but everything else is just the natural flavor of our coffee. And again, as we are positioning our cold brew as an alternative for sugary energy drinks. That’s something that we think is gonna hold in our favor.

Gary Nowacki: And you know with all the innovation you’ve done in the last five years how do you and your team, Rod, how do you stay motivated to keep innovating what drives you to keep coming up with the next thing?

Rod Johnson: Yeah, I mean, it’s fun, some days. I mean, when you get big wins like our licensing agreements with Marvel and the NBA, that’s something that’s extremely gratifying. When you get a chance to partner with the likes of Ben and Jerry’s, the Premier B Corp, that’s also a huge validator. So, it’s having those wins under our belt that gives us more fuel in our tank. But really it’s what we’re doing this for it so that we can be a vehicle be a resource for those who otherwise just need a boost, right? You know a ton of talented people that are just in unfortunate circumstances and if we’re able to spark a fire in them and for them to you know that’s a track that we want to continue, a path that we want to continue to forge down.

Gary Nowacki: And speaking of that, if I have it right, the math is impressive. You know, I know of companies who say we give, you know, 1% of our net profits to charitable good causes. Um, but you’re giving not just 5%, you’re giving 5% of revenue to these causes.

Rod Johnson: Yeah, fine. Top line, right? I mean, so before we pay ourselves…

Gary Nowacki: That’s, that means let’s, I don’t know anybody else who does that. Do you know anybody else who does 5% of top line?

Rod Johnson: I’m not certain, right? So maybe we’re onto something or maybe we’re, maybe we’re not onto something. Yeah, I mean, but that’s really what it is.

Gary Nowacki: You’re just super good people.

Rod Johnson: I mean, thank you for that. I receive that and I appreciate that. That kudos is very validating, but it’s, you know, it’s, that just feels like the right thing for us to do. You know, we started this business with the intent to give back. My business partner and I grew up in Gary, Indiana, right? And I don’t know if your listenership is familiar with the area, but you know at one point it was the epicenter of the steel industry for America. You know just that, that you know Indiana, Northwest Indiana, Pennsylvania, Ohio, that area.

But then when those jobs are shipped overseas, you leave those communities to fend for themselves and to seek alternative means of survival and you know, that led Gary [Indiana] to, you know, really be the poster child of those efforts, if you will. And it’s not that people don’t desire better, it’s just that they don’t have proximity to it, so to speak. And so again, if I could use what I’ve learned to give back to the community that I owe so much to my personality, to my perseverance, just to into my whole ethos, then that’s something that I want to continue to do.

Gary Nowacki: How’d you get to Des Moines to have the business base there? I’m just curious what, it’s not the epicenter of the coffee business, right?

Rod Johnson: Yeah. Oh gosh. Yeah. You know. Not at all. You don’t think about, you know, coffee in Des Moines. Those don’t go hand in hand. Yeah. No, Des Moines and Iowa at large is known for corn. In fact, my house is surrounded by a cornfield. Prior to living in Des Moines, I lived in California. My goal after college was to avoid the snow at all costs.

 Gary Nowacki: Ha ha ha. Mhm.

 Rod Johnson: So, I moved to California, but my business partner had other plans for us, I guess. You know, he met his wife who is originally from Des Moines and after they decided to grow their family, they moved to where they have resources and simultaneously, we were building the business. I was responsible in California for all things digital. So, you know managing our social media, email, paid ads, etc. while Pernell really manned the operations from his garage. And once we outgrew the garage, he gave me a call and said, hey, man, do you want to trade those palm trees for cornfields? That’s like, that’s a big ask, my friend. But really, it was necessary. And I’m grateful because I think a lot of opportunities have manifest themselves just by us being in close proximity. So, I have him to blame for us being in Des Moines, but that hasn’t stopped us from having national accessibility.

Gary Nowacki: It’s a great American success story, the startup in the garage. So, it was a garage.

Rod Johnson: Yeah, and 1000% was a garage. You know, you can add our picture to the likes of the Amazon with Jeff Bezos and everybody else who started a garage. Funny story about that or about this. You know, we had to, it’s a garage, right? And we needed to do what we needed to do in order to make it a roastery. So, we cut a hole in his garage so that we can have the exhaust go out. And you know, we’re self-taught roasters and self-taught businesspeople. During those earlier days when we were roasting coffee, we weren’t doing it right. There was so much smoke emitting from the garage that the neighbors called the fire department thinking that the house was on fire. We still have that first bag of beans, it’s as black as your shirt, as a reminder of what not to roast coffee like.

Gary Nowacki: Ugh. When they called the fire department, they must have said this house is on fire, but it smells great.

Rod Johnson: Yeah, I don’t know if it smelled so great, Gary. Those beans were, they were crispy, okay?

Gary Nowacki: Oh, so Rod, since so many of our listeners are food CPG innovators, you know, and they work on the bench, they work, you know, as food scientists, they work as creators. What, what can you share about a typical, you know, concept to creation to store shelf situation with coffee?

When you have a new idea, without divulging any trade secrets, what is the process for you and your team?

Rod Johnson: Yeah, well, you know, it really starts from the source and ensuring that your, that the beans have some distinction to them, if you will. So coffee is a very absorbent plant, and it takes on the characteristics of what’s grown in close proximity. So, you’ll see often on coffee bags or specialty coffee bags, excuse me, in a read, you know, caramel, toffee, and nutty flavor. It’s not that there were additives, you know, that were injected into the roasting process. That’s just what the coffee naturally tastes like based on what’s grown. Like I said, in close proximity. So, if we have an idea that, you know, hey, we want to, I’ll use, a couple of years ago, we decided that we wanted to feature and highlight the differences of coffee grown in Ethiopia, which happens to be the birthplace of coffee.

We sourced from different farms and different co-ops in those areas and then brought it back to our facility in Des Moines and did some test roasting, if you will. Take the green coffee and you roast it to different specifications with hopes to draw out different flavors, if you will. So that R&D process takes a little bit of time. And then from there, when you have something that you know smells and looks the way that you want it to, then it goes to cupping, which is a very much so scientific process is what I referenced earlier that how coffee is graded. We have our roasters and anyone else who’s interested in being highly caffeinated for the day and then there’s a lot of taste testing, if you will, to compare and contrast how if a coffee should be a medium roast or if it should be a light roast or if it should be a dark roast.

And the variance between those different roast levels are like a couple of minutes if you will and so that cupping process gives us the opportunity to align on how long we want to roast a particular set of beans and then from there you know, it’s time to shop it to different retailers if it’s not just going to be an online only opportunity. So that’s the abridged version, but that R&D process is really where the decisions are made. There may be opportunity or maybe times where a farmer says, hey you should roast this as a light roast, but during our process we have determined that maybe this should be a medium roast because it really accentuates certain flavors.

Gary Nowacki: And that process, that iteration, do the retailers sometimes jump in the loop and give feedback and direction as well?

Rod Johnson: Not necessarily, but with our cold brew, for example, Target played a much more significant role than they would have otherwise. So, Target has the desire to be a destination for coffee and a destination for cold brew coffee in particular. So, they had a little bit more of a say so in the formulation and the aesthetics of our cold brew coffee.

And we absolutely welcomed that because that obviously, they were gonna be satisfied with it, that equates to distribution. So, it is atypical, but if there are opportunities like that present themselves, that we can scoot over and have another seat at that R&D table.

Gary Nowacki: It makes sense because you mentioned Generation Z being your friend on cold brew prepackaged and you know, obviously Target prides itself in its brand on staying in line with trends.

Rod Johnson: Absolutely. Yeah, they’re definitely, they have their ears for the street, if you will. And, you know, as Generation Z continues to grow in numbers, it will behoove retailers and brands to pay attention to their interests. Fortunately for us, we have insights that we leverage to make sure that we’re making the right decisions. And when we found out that, again, cold brew was the highest growing segment in coffee, those gears started to turn.

Gary Nowacki: Yeah, and speaking of Target, I was on your website, so you know, you’ve got a zip code finder for any folks who have not tried your coffee, but you also direct ship, right, for folks who may not have a store, and you have sort of a subscription service as well.

Rod Johnson: Yes, yes, that was our bread and butter initially. When we were deciding what’s our business model going to be, we chose the path of least resistance and the one that had the fewest barriers of injury, which pretty much eliminated brick and mortar. And not that we don’t have any aspirations to have our own in-person experience, it just takes a lot to manage a location. So, our way of getting to the people and being accessible is obviously having our online store where you can set it up, forget it, sign up for recurring orders, or be directed to one of our retail partners that’s in close proximity to where you are.

Gary Nowacki: Excellent. Is there anything you can share without giving secrets away Rod? Is there anything you can share with our listeners on you know what’s next for BLK and Bold?

Rod Johnson: Yeah. Well, one, it will be to have our own in-person experience. We think about our revenue channels, and we have four legs to that table. We have our e-commerce, our digital experience. We have our retail partners. We have our wholesale business. So, when you think about hotels, universities, cafes, restaurants, we partner with some big players in that space so that our coffee can be experienced out of the home, but we don’t want to be totally reliant on that to, again, curate what that BLK and Bold in-person experience will be like. So eventually, as I say eventually, as in within the next, you know, I’ll call it two to four years or three to five years, we will have a few brick-and-mortar spaces. It won’t be to the same cadence as like a Starbucks or a Dunkin’ because we have just different ideas as to what that space will be used for. We want to find ways to incorporate our social impact mission, you know, a little bit more tangibly into those spaces. So, is that more of a community center? Are there, is it, at minimum it’ll be multifaceted. They just won’t be coffee shops, so to speak. So, as we are still fleshing out those ideas, that is absolutely on the horizon.

Gary Nowacki: Mmm. Yeah.

Rod Johnson: In addition to that, we are in the process of standing up our nonprofit foundation. So rather than just writing checks from the for-profit side of the business, we’ll have a nonprofit experience that will really solidify all of our philanthropic efforts. And then lastly, you know, we are, we’ll look to reimagine what does headquarters look like so that it is a bit more consumer facing, and we give people a reason to come visit the middle of middle America, aka Des Moines, Iowa.

Gary Nowacki: Well, I’d love to visit one of your stores when they open. I mean, it’s another opportunity for you to just differentiate your branding, right? It’s just because, you know, so many coffee shops, I mean, coffee shops are great. Everybody loves a coffee shop, but they’re all sort of the same, right?

Rod Johnson: Yeah, yeah, they, you know, there’s a little bit of rinse and repeat that goes on with coffee shops. In my role prior to starting this business, I did a lot of traveling and spent a lot of time in coffee shops. To your point, you know, they kind of all look and feel the same. And you know, no fault to them. That just creates a lane, you know, for those who are a little bit more innovative and creative in how they do things.

Gary Nowacki: Yeah, yeah, well that’s neat. So back to innovation, you know, any tips you can give to our listeners who are aspiring entrepreneurs or even working for a large company doing innovation, you know, any tips you would give them, any stories you would tell based on your experience?

Rod Johnson: Yeah.

Rod Johnson: You know, I’ve said this a lot and I’m like, should I continue to die on this hill? And I just fundamentally believe this, that there is an audience out there for you, even if you’re in a crowded space like coffee. I mean, there are thousands or hundreds of thousands of coffee brands and coffee experiences in the US, let alone the world. I mean, coffee is the second most consumed beverage in America, right? And that’s behind water.

So, it’s not like there’s any shortage of coffee brands, but we felt as though this was something that was authentic to our lives. Like I said, I spent a lot of time in coffee shops and I’m positive that Pernell’s blood type is caffeine, based on how much coffee and caffeine that guy drinks. So, it was something that was very authentic to us. And then we attached it to a mission that we both lived and believe in and try to eradicate.

And fortunately for us, there’s a tribe of people out there who wanted that level of representation. So, I think that people do a disservice to their communities, to the communities that are out there that are just waiting to hear from them. So, get out of your own way. Impostor syndrome is real. I get it. We did not know how to; we didn’t come from entrepreneurial families. We didn’t come from coffee related industries right and we didn’t grow up around farmers or certainly be a be baristas or anything along those are those what it was really just a matter of uh… feeding that curiosity and that urge to uh… take more command over the impact we were making and we’ve been satisfied with our jobs but we’ve been wanting more and we were able to pursue that so has those aspirations whether you’re an entrepreneur or an intrapreneur in a in a larger organization uh… don’t uh… be fearful of failure because you know that that’s just that that’s a part of it and that only strengthens and sharpens that sword as you continue to fight the good fight.

Gary Nowacki: Mm-hmm. Yeah, don’t just be better, be different, right? And you folks really have created something that sounds like it’s really different.

Rod Johnson: Yeah. I think so. I think so. And you know, there’s a, I saw a saying recently, it was something to the tune of, you know, go deeper, not wider. And it’s just like, you know, really homing in on your craft as opposed to being a Jack or Jane of all trades. And that’s what we’ve done. You know, we know our core product, we know who our core audience is, we know the demographic that we are trying to serve at, and we do that. You know, we’re not trying to…

Gary Nowacki: Yeah.

Rod Johnson: …spread ourselves to then and I think those that are in our ecosystem are appreciative of us speaking directly to them.

Gary Nowacki: Mm-hmm. Rod, before we go into wrap up, anything else you’d like to share with our listeners about BLK and Bold Coffee?

Rod Johnson: Gosh, you know, again, we are a coffee company that, you know, doing some cool things. Most recently, we were named in the Inc. 5000 as, you know, one of the fastest growing privately owned companies in America.

Gary Nowacki: Congratulations.

Rod Johnson: And of those 5000 brands, thank you for that. We were number 61. And they take into consideration the growth over three years, so for us it was 2019 to 2022, where to be on a list is amazing. To be number 61, to be number one in the state, number two as a B Corp, top 10 in the food and beverage industry, I think that it’s a testament to us answering the need that consumers have. They wanted a socially conscious brand, they wanted quality coffee, they wanted it convenient and accessible in the fact that we’re able to check off those boxes I think is uh… it resulted in as being on that list so I would not but we’re not stopping there we have uh… lofty your goals and I look forward to stand on that list for as long as possible.

Gary Nowacki: You’ve built a really neat company and as the old saying goes, “You’re not just doing well, you’re doing good.”

Rod Johnson: Thank you. Thank you for that.

Gary Nowacki: I want to thank my guest today, Rod Johnson, Co-Founder of BLK and Bold Coffee. Check it out. Go to their website. Use your zip code finder. Try their coffee. And, you know, Rod, thank you so much for being on the podcast today.

Rod Johnson: Thank you, Gary. I appreciate you