Peter Rahal, Founder of RXBAR, discusses the creation of RXBAR and its success in the market. They focus on their initial plan to raise money, the challenges they faced in manufacturing and marketing, and their unique marketing strategy in the CrossFit community. The episode also touches on Peter Rahal's background, upbringing, and his upcoming Lebanese wedding.
RX Bar was able to achieve success by identifying a niche within the CrossFit and paleo communities and creating a product specifically for them.
The acquisition of RX Bar by Kellogg's for $600 million provided financial security and access to a wider audience through Kellogg's extensive resources and distribution network.
Deep dives
Starting in a Crowded Market
Peter Rayhall and his co-founder Jared Smith started RX Bar in 2012, entering the already crowded energy bar market. However, they identified a niche within the CrossFit and paleo communities and focused on creating a product specifically for them.
Early Challenges and Growth
In the early stages, Peter and Jared manufactured the bars themselves in Peter's parents' basement. They faced challenges with shelf stability and had to deal with inventory issues. However, their product gained traction through word-of-mouth in the CrossFit community, and within nine months, they achieved $600,000 in sales.
Expansion and Retail Success
As demand grew, RX Bar expanded its distribution and became available in major grocery chains like Trader Joe's. This expansion, along with e-commerce sales, led to significant revenue growth, reaching $36 million in 2016.
Kellogg's Acquisition
In 2017, Kellogg's acquired RX Bar for $600 million, reflecting the brand's success and potential. The acquisition provided financial security and allowed RX Bar to reach a wider audience through Kellogg's extensive resources and distribution network.
In 2013, Peter Rahal was obsessed with CrossFit, but noticed it didn't sell any snacks to align with its pro-paleo philosophy. So instead of joining his family's business, Rahal Foods, he recruited his friend Jared Smith to start making their own protein bar. They made the first RXBAR in a Cuisinart in Peter's parents' home in suburban Chicago. By 2016, RXBAR was doing over $36 million in sales, and in November 2017, the founders sold the company to Kellogg's for $600 million. Recorded live in Chicago.
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