CEO Runs a Successful Startup that Transforms the Supply Chain

In the world of entrepreneurship, success often comes to those who adapt, innovate, and continuously improve their products and services.

In this episode, Eran Mizrahi, the CEO of Ingredient Brothers, understands the importance of building a high-performing team and investing capital wisely. Mizrahi shared his journey of starting a business and the key lessons he has learned along the way and explore the strategies he employs to build a successful startup.

Mizrahi believes that in order to succeed, startups must embrace continuous improvement methodologies. He emphasizes the need to constantly evaluate every step of the customer journey and find ways to make it better. Whether it's improving communication with customers, enhancing compliance processes, or increasing transparency in the supply chain, Mizrahi stresses the importance of iteration and continuous learning from day one. With a culture of continuous improvement, startups can stay ahead of the competition and provide exceptional value to their customers.

Conclusion:
Eran Mizrahi's journey as the CEO of Ingredient Brothers serves as an inspiring example of building a successful startup. By embracing continuous improvement, building a strong network, allocating capital effectively, and nurturing a high-performing team, Mizrahi has paved the way for his company's growth and impact. His insights and strategies provide valuable lessons for aspiring entrepreneurs and CEOs navigating the challenges of the startup world. With the right mindset and a commitment to excellence, startups can overcome obstacles and create lasting success.

Website: ingredientbrothers.com

Full Interview:

Eran Mizrahi Teaser 00:00

We map out the customer journey and every step of that customer journey is like an iterative process.

How do we make this better? How do we make the communication with the customer better? How do we make the compliance part better? How do we ensure like more transparency in the supply chain? And again, because we're a startup, we're iterating, right? We're not perfect. We're at day zero.

And so, we have to have that continuous improvement methodology within our culture.

Intro 00:23

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Gresham Harkless 00:52

Hello. Hello. Hello. This is Gresh from the I Am CEO podcast. I have a very special guest on the show today. I have Eran Mizrahi. Eran, it's great to have you on the show.

Eran Mizrahi 01:00

Thanks so much, Gresh. Nice to be here.

Gresham Harkless 01:02

Yeah. Super excited to have you on and talk about all the awesome things that you're doing. And of course, before we jumped into that, I want to read a little bit more about Aaron. So you can hear about some of those awesome things.

Eran grew up watching his father grow a successful import business that was built on integrity and customer service. A South African transplant. Eran started his career at Deloitte.

From there, he came to New York to pursue his MBA at Columbia, graduated in 2014. Eran was an early employee at Plated, where he focused on building, planning and sourcing programs. The team's collective efforts led to a 300 million sale to Albertson, and he then went on to join Neus.com, one of the world's largest, and specialty ingredient e-commerce companies.

He was quickly elevated to COO and quadrupled the company's capacity to support growth in 2020. And I'm super jealous of Eran because he took a gap year in college, which I've always wanted to do. I think he went on to culinary school, if I read that correctly. And I love that he has entrepreneurship.

I think he said in his DNA going to selling culinary books, if I heard correctly, when he was like 10 or so years old or maybe eight or something like that.

Eran Mizrahi 02:09

It was very early on. I, always wanted to sell things and then I became an accountant, which doesn't make any sense.

Gresham Harkless 02:17

Hey, it's both sides of the brain, right?

You've been able to do that. And then one of his quotes that he lives by that I absolutely love is that you create your own look. I think so many times we can point fingers and say this didn't happen because of X, Y, and Z or A, B, and C, but I love how that mentality just propels you into being able to take control of your destiny, so to speak.

So Eran, excited to have you on the show. Are you ready to speak to the I Am CEO community?

Eran Mizrahi 02:38

Let's do it.

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Gresham Harkless 02:39

Let's get it started then. So to kick everything off, I know I touched on it a little bit, but wanted to rewind that clock, hear a little bit more on how you got started, what I call your CEO story.

Eran Mizrahi 02:48

Awesome. Yeah. Thanks again for having me. The story is, there's so many different routes That I took to get to where I am today and start a business. And so, I think to your point, what you mentioned earlier was the, I did, I dropped out of college after my first year to go to culinary school.

I think much to my parents dismay and, trying to figure out what I wanted in life. And, I've always been inquisitive and always been curious and always. Had this entrepreneurial bargain, just didn't know how it was going to, manifest itself and landed up, going and joining Deloitte, like you mentioned, and being more in the finance world and then had the opportunity to come to the U. S to go to grad school and that, doing my MBA in the U. S really gave me amazing opportunities.

The ability to speak to people gave me two years off. To explore and be curious again. And when I was leaving, I was lucky enough to get a role at plated, which was a early meal kit company.

And I think, the U. S. market being so big and just, I'd never even thought about going back into food and hadn't really, even, that wasn't on the horizon for me. It was all finance. And then suddenly coming here, just seeing the big market was able to join plated and then not start common, throughout my time at those two places.

It's. Kept seeing the same patterns within the B to B wholesale space. I being a finance person, I always look for arbitrage, trying to find, inefficient markets, trying to find places where, one side has more information than the other. And I think B to B. Sourcing just, kept coming up as that place where, you know, as a buyer, you're usually buying so many different ingredients from so many different vendors and the vendors are the experts.

They know exactly what they're paying. They're spending the time. They're spending the resources and there wasn't always the best sharing across the aisle. And so it felt like, Come into this industry. Maybe we can do something a little bit different and decided in 2021 that it was time and convinced I left.

He used to work with me at nus.com and he was now running operations at a company called Simply Gum. And convinced him to jump ship and we started in about July of 2021.

Gresham Harkless 04:42

Nice. I absolutely love, hearing that journey and I was wondering you talked about being able to see patterns and it wasn't like all the experience that you had in the course that I think that accounting background as well, too.

Did that help equip you to be able to see those patterns, but also probably see that opportunity that wasn't being fulfilled.

Eran Mizrahi 04:59

Yeah, I think so. I think that, you make a great point, right? Everything happens for a reason. And definitely having good foundation played a big part in, identifying the opportunity.

But at the same time having been a Deloitte, what I realized was that if I wasn't going to be in an industry, I wasn't going to see the opportunity. And I do think, no matter what industry you're in, You can see the opportunity and you can see it. You can see a business idea.

Whether I would have gone into food or built, got into some other industry. I still think I would have come out with business idea of some sort, right? Because everywhere there's inefficiencies, right? There's no efficient markets. And so I think making that change into industry and actually being the customer.

And being the user and seeing the tools that I was using, I think that was, really the pivotal moment where I, I remember complaining to my dad when I started playing it, just being like frustrated. I need the idea. I need to figure out what I'm going to be doing. And he's just put your head down, just go work as hard as you can.

And one day it'll come. And I was like, nah, I don't believe you. And then eventually it did. And he was right. So, I think to your point being, a lot of founders want to find that idea that is outside of what they're used to doing on every daily basis.

But there's just so much in front of you if you're able to be an industry for a while and getting that experience, you'll see that those opportunities come to light.

Gresham Harkless 06:12

Yeah, that makes so much sense.

Eran Mizrahi 06:14

And so I think, exactly that point right where you're trying to, look for things that are the end results of many, many iterations. And sometimes it's all about, finding that little niche that you think you can do a little bit better and have conviction around.

And again The hardest thing is making the leap right once you make that leap, then things start to happen. But that first initial leap is really, really the most challenging part of the process.

Gresham Harkless 06:39

Absolutely. So speaking of leaps, I wanted to hear a little bit more about what you leaped into. Could you take us a little bit more into your organization? What you're doing, how you're making that impact there?

Eran Mizrahi 06:48

Yes. Ingredient Brothers are really fun business, right? What we do is import raw ingredients. Let's call it natural ingredients from all around the world. We, I think we currently import from about 12 different countries into the US and we're mainly supplying big consumer brands or even startup CPG brands that are, trying to do something in the natural food space.

And so, what we do is we offer a platform for the world's best manufacturers of those raw ingredients. We also handle all the compliance logistics, the movement of that and then, trying to identify who the right manufacturing partner is for our customers. And so we, do an end-to-end supply chain solution for natural ingredients.

A lot of what we pride ourselves on is that we have a very global team. A lot of our team sits in Southeast Asia as well as South America. And, we put a lot of emphasis on compliance. And what that's meant is that, have to invest in technology and building things ourselves.

We're not a technology company, but we're almost forced to do that because, we wanted something specific for our industry for what we do. And the best way to do that was to build something ourselves. And so that's what we did.

And, all those little things You know, there isn't that, like I said, there isn't that one big thing that makes us different. But all those little things across the supply chain that we can just do a little bit better. Those are the things that have led us to where we are today.

And now we're 30 people in two years. We're 30 people and we're importing from 12 different countries and bringing in a significant amount of volume.

Gresham Harkless 08:13

Nice. I absolutely love that. And that kind of probably is a little bit of the secret sauce. I imagine is that and I think so again, just there's like such a misconception or perception. I can't get the words together that people have where You have to have this one thing and that one thing is going to be the thing that breaks through the noise.

But I love how you talk about having those quote-unquote small things that when you start to add them up ends up being a whole big thing because no one's going that extra mile along all those different avenues.

Eran Mizrahi 08:44

Correct. Like we map out the customer journey and every step of that customer journey is like an iterative process.

How do we make this better? How do we make the communication with the customer better? How do we make the compliance part better? How do we ensure like more transparency in the supply chain? And again, because we're a startup, we're iterating, right? We're not perfect. We're at day zero.

And so, we have to have that continuous improvement methodology within our culture so that It isn't about this is what we're building.

Yes, everyone knows that. But every day needs to be one step closer towards that, right? We're climbing a mountain and you don't climb a mountain by jumping one step to the top, right? You do it one step at a time.

And I think that's the, the mantra that we have. It's take. That journey and every day, the person is responsible for each part of that journey needs to do something to make that journey better and improve the product.

Gresham Harkless 09:30

Yeah. So absolutely appreciate that. And so I wanted to switch gears a little bit and ask you for what I call a CEO hack. So this could be like an app, a book or habit that you have, but what's something that makes you more effective and efficient?

Eran Mizrahi 09:41

Yeah, I was thinking about that a lot. What is the one thing that I've leaned on in terms of becoming what I, let's say for now, somewhat successful as a CEO. The biggest thing is network, right? And I think being thoughtful about the bench that you're building as a CEO, right? CEO is a very lonely role. And you're not reporting to anyone.

You have to make a lot of decisions and so and a lot of times when you're a startup, you have no board and no, investors and things like that who you can really need on a daily basis. And so the thing I've done and been very specific about is built a bench of people that I can lean on for different things, whether it's sales or supply chain or it's fundraising or it's, human resource issues.

And I think that, I come from somewhat privileged because I was able to go to business school and had some network, but again, a lot of people that I've lent lean on a lot. It's like people that have just done. Random outreach on LinkedIn. And those people have been great supporters of mine and have, given me time.

And I think, being organized around that, knowing who your net, who your bench is who's on your bench, what do they know how to do and leaning on them and not being afraid to lean on them, I think is super important. As a founder, you have to do everything with all the resources at your, at your disposal.

And if you've got someone, you abuse that until Yeah. Yeah. They tell you to F off and at the same time, I think people respect that and they want to help. And then when they reach out to ask you for help, you make sure you give them the time that they deserve. And I think that's been huge help.

And just the most I would say like one antidote is like Someone who like through so many degrees of separation helped me and then landed up getting funding from like a secondary lender. And I think, had I not maintained that relationship and that network, it would never have happened.

And so, don't take those things for granted. I think it's a free resource that just requires, some commitment of time.

Gresham Harkless 11:33

Yeah, absolutely.

Yeah, that makes so much sense and I don't know if that's part of the nugget that you would share the thing that makes you more effective and efficient.

But I think the true people that are really great at business are able to mitigate risk and they're planning and they're preparing. They have a good team and all those things. Do you feel like that's. Part of the nugget you would share.

Eran Mizrahi 11:49

Oh, a hundred percent. I think planning is the nugget, right? And it's not necessarily about, this super accurate plan, when you like this to this two types of planning, in my mind, there's like financial planning, which is, incredibly important for a founder to understand the drivers of their business, right?

What are the variables that they need to move? When, financially planning the next quarter and what is it going to take? Because I think a lot of times founders will have a plan in mind or have something that they want to execute on, but haven't actually written down the numbers and understood what is that going to actually take?

And then the second thing that has to happen in tandem with this is resource allocation. Because, again, what I always find is that, you know, this is definitely very true in the U. S. more than anywhere is that. There's so much opportunity, it's incredible and founders then tend to find themselves with more things that they could do to drive value within their company.

Then they have resources for and so you have 2 choices, right? You can either go after more than you can chew and then. You land up in a situation where hopefully you get lucky and one or two things pan out, or you can sit down and allocate resources against all these things and say, what would it actually take to do these things successfully and allocate those resources correctly?

And I think that's something we do extremely well in Ingredient Brothers, right? We stay extremely focused. And even though we're 30 people, and that's a lot of people for us to your business, everyone knows what they need to do. And we know what everyone's doing so that we don't allocate. The wrong, to, too much work on to people, right?

We're like, 10 different strategic projects are suddenly lumped into 3 of the same people and you land up. Effectively failing and then burning people up, which is not what you want, right? So I think, that planning and that process and understanding the variables.

Gresham Harkless 13:37

Yeah, I appreciate you so much in sharing that. So wanna ask you now my absolute favorite question, which is the definition of what it means to be a CEO and we're hoping to have different quote-unquote CEOs on this show, so, Eran, what does being a CEO mean to you?

Eran Mizrahi 13:48

Yeah, I think that's a very tough question. And it's a good question. I think, honestly, the tactical answer that I'll give is being a CEO is being effective at allocating capital, right? And I know this sounds crazy. But in a world where we're all constrained by capital, whether it's your bootstrapping it or your fundraising, you need to invest that dollar and get more than a dollar out.

And you need to also, relative to other investment ideas, be able to invest in that, is both has impact on the short term and long term, right? What long term investments are you going to make? What is the payoff that you're thinking of? What are the short term investments you're going to make?

And that. Again, like that investment is in people in markets in different strategies. And I think, because I'm a finance person, I believe in compounding. Compounding is super incredibly powerful, right? If you look at compounding, you model it out, you realize that if you're able to make a return and keep reinvesting at a good return, you've got an incredible business.

And so I think about that is my responsibility, right? Being able to Allocate capital and know when to shift capital allocation into different objects, into different projects, given some other payoffs that I'm seeing or inefficiency in the market. And then the other side is building a high-performing team, right?

You've got to be able to build a team that does not rely on you as a founder. And my team talks a lot about freeing Iran, right? Because obviously we're small and I'm still involved in so many things, but we need to build a high-performing team and you need to build a team that is a line on your vision.

You have to keep repeating the vision. Keep repeating the mission. Keep repeating those financial goals being super consistent, right? Super, super consistent. Like people should be bored when you get up and say things because it should be very clear what we're doing, why we're doing it and where we're going.

And so I think like that, those are the 2 things that I think of is like my Primary responsibilities as a CEO and what it means to me and the people stuff is the most fun and most rewarding, right? So being able to build a team, build people in their careers, give them professional development, see them fly.

It's, selfishly the best feeling in the world. And so, really love. Love doing that every day.

Gresham Harkless 15:49

Yeah, absolutely. So, Eran, I truly appreciate that.

Appreciate, of course, your time as well. So what I wanted to do now is pass you the mic, so to speak. Just to see if there's anything additional that you can let our readers and listeners know. And of course, how best people can get out of you, find out about all the awesome things you and your team are working on.

Eran Mizrahi 16:04

Awesome. Yeah. Ingredientbrothers.com or you can find us on LinkedIn. We're super active. So on Ingredient Brothers on LinkedIn.

Gresham Harkless 16:10

Awesome. Awesome. Awesome. And to make that even easier, we'll have the links and information in the show notes, too, so that everybody can follow up with all the awesome things that you all are doing.

But I truly appreciate all the awesome things you're doing. And I hope you have a phenomenal day.

Outro 16:21

Thank you for listening to the I Am CEO podcast powered by CB Nation and Blue 16 Media. Tune in next time and visit us at iamceo.co. I Am CEO is not just a phrase. It's a community.

Don't forget to schedule your complimentary digital marketing consultation at blue16media.com. This has been the I Am CEO podcast with Gresham Harkless Jr. Thank you for listening.

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