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    [S2:Ep #14] Cheese, please!

    Featured Image

    Seeking a delicious cheese-like experience? Join Tommaso Di Bartolo, founding partner of Awesm Ventures, along with industry fellows Alan Ramos, an entrepreneur with extensive experience in startup incubation and acceleration, Founder at Libre Foods, and Dheeraj Talreja, President of AAK in India, hosts a passionate game-changer in the next gen proteins space: Kobi Rege, Founder and CEO of Pleese Foods.

    TopFloor: Where handpicked startups present sector-specific innovations to a jury of industry fellows

     

     

    In Season 2, recognized world-class Researchers, Scientists, Faculty Members, Senior Executives, Experts, Chefs, Investors and Entrepreneurs from around the globe, engage in strategic exchange of views and share startling intel on viable transformative innovation in Agriculture, Food and Beverage, zooming in the next gen proteins space.

    Topfloor is where inspiring and passionate game changers, visionary entrepreneurs share startlingly impressive intel on food of the future with a panel of experts.

    With Special participation of

     

     

    [Industry Fellows] Topfloor: S2:E14 

    Dheeraj Talreja

    Alan Ramos

    Dheeraj Talreja
    Alan Ramos
    President, India at AAK
    Former Startup Incubator, Founder at Libre Foods

     
     

    [Startup Entrepreneurs] Topfloor: S2:E14 

    Kobi Regev

    Kobi Regev
    Mr. CEO - Pleese Foods
       


    Host

    TOMMASO-AVATAR
     
    Serial entrepreneur w/ 2 exits, author, advisor, faculty, investor.
     
    http:///tommasodibartolo.com 
    Tommaso Di Bartolo
     
     

     

    Key points:

    • Plant based cheese
    • Value proposition
    • Market Strategy
    • Sustainable package

     

     

    I prefer 📹 watching the episode's video

     

    I want to listen 🎧 to the episode's podcast

     

    Episode's 🔖 Transcription

    Tommaso: Good morning, so first, Top Floor is what handpick startups in the space of sustainable alternative next gen protein that present their specific innovation to a jury of industry fellows. Koby Rege is here today presenting his startup as a founder and CEO of Pleese Foods created for people who are avoiding diarrhea or allergens for dietary reasons, but are still seeking a delicious cheese-like experience that can be enjoyed without any concern. So we'll be hearing more about Kobi, Kobi again, what I'm really curious to hear is how this thing started? Where do you guys stand? How are you guys different in this space?

     

    Then we're going to have on the other side of the table Dheeraj Talreja, president of AAK in India, present in more than 20 countries. Well, what a pleasure to have you today here on our episode.

     

    From the German Silicon Valley in Berlin, Alan Ramos, an intrapreneur with extensive experience in startup incubation and acceleration, founder of Libre Foods for a purpose for early stage startup in the next gen protein space. Alan, what a pleasure to have you here. 

     

    Plant based cheese 

     

    And while I know that Dheeraj and Alan will have a bunch of very intriguing questions around the business case and the business of Kobi. Without further ado, I would like to share the screen here with Kobi. Please take it from here.


    Kobi:
    Hi, everybody. My name is Kobi Rege. I'm the CEO and co-founder of Pleese Foods. It’s my honor and privilege today to tell you about our revolutionary new product, Pleese. It's a plant based cheese that we developed to melt perfectly on all of our favorite comfort foods. Made from all natural ingredients, like being in potato proteins, and it's crafted using traditional methods without any dairy. And most importantly, it's approved by the harshest food critics in the entire world, kids from New York City and people have told us it's so good that they can't tell the difference. 

     

    My wife Rebecca and I are just a couple of New Yorkers who happen to be vegan. We changed our diet in 2014 for health reasons. Our biggest pain point living in New York was life without decent pizza and we realized we weren't the only ones. There are over 100 million people in this country who, like we’re vegan, but there are 100 million people who are either lactose intolerant or have really harsh food allergies. So we took it upon ourselves to create the most perfect cheese-like experience for pizza. This category, we're not the first ones in this industry. This category has grown by 64% in the last three years, and it's going to be worth $7.5 billion by the end of the decade. And all of that while looking like this on pizza, that wasn't good enough for us. I can't even tell you how particular I am when it comes to pizza. So like I said, we saw what was available and we decided to do it better. So you can see what the past was like and now what the future brings with Pleese. 

     

    This all started kind of as a hobby. I love pizza. I know everything about pizza. But this wasn't what I thought I was going to be doing with my life. Basically, we changed our diet and one day I was having lunch with my brother and he kind of looked up from his plate and he goes “what kind of frickin New Yorker can live without pizza?”. So I told my wife that story, and she was like “you know, we're gonna show him” and she ran to the closest supermarket, she bought some pizza dough, she got the ingredients for a sauce, and she got the available store bought vegan cheese, and she made the ugliest pizza you've ever seen in your life. But it tasted amazing. Because it was vegan, we haven't had cheese for so long. We thought we could change the world because we can make pizza for ourselves now. 

     

    Now I have the type of personality where nothing is really good enough for me. I have to always figure out how to make it better. So while we didn't mind the store bought cheese, our friends who weren't vegan didn't like it as much as us. So we began experimenting, and I started making my own dough. We started making our own cheese from cashews. We posted these pictures online and all of a sudden our Instagram exploded, people thought we had a restaurant. I don't know if you're aware of this, but when you go onto Instagram, you have to put your phone number so people actually got our phone numbers. So start calling us and ordering pizza, asking us where New York our location was like.

     

    It blew our minds that our hobby had become something real. So through friends we were introduced to this couple that we're planning on opening. We were introduced to this couple that was planning on opening a food market in New York City and they came to our home. They were like “You guys are so cute, the food industry is really hard. Maybe you shouldn't even bother”. And then they tried the pizza like “Nevermind, you're going to be our pizzeria in this food market”

     

    So at the time I had a high paying job. I was a sales director for a luxury jewelry company. I was traveling around the country. And I went to Neiman Marcus Saks Fifth Avenue. That's the type of clientele I used to deal with. I had employees. I had an office and I left all that behind to go work in a pizzeria. And that was probably one of the smartest things I ever did in my life. Because it completely changed the trajectory of everything that we did. 

     

    While working, my wife's a teacher, and while working at the pizzeria, kids kept on coming in and saying, “Is there any soy in the oil? Is there any corn starch in  the dough?” and it made me realize “Oh, wait, like allergies are real. It's not just dairy. There's other serious allergies out there.” Then I asked my wife about this “How is it in your school?” And all of a sudden she's like “Wait, we can't bring cashews or any nuts into the school”. So I quit my job. I was working on this pizza and Lena was changing everything so we could open this pizzeria and then all of a sudden it's like “Wait, kids can't have our pizza. What do we do?” And that question drove me nuts. And I literally went back to the drawing board and I went “Okay, what else is there I want?” And the most prevalent cheese alternative available is soy cheese, but people are allergic to soy. And I went “Okay, soya is a bean, what other beans are there?” And this was the result of that whole crazy endeavor. So cannellini beans do an amazing job, they melt, they stretch. It just tastes so good and it looks like the real thing. 

     

    This has not been a very quick journey, let's say like that. But every single step took us closer to where we are today. And as I said earlier, changed our trajectory. So about five years ago, we started everything as a hobby. We were on Instagram, you know, it really blew up. I quit my job. And then we were invited to participate at the Whole Foods Seed and Wine Festival where we were told we were going to go to the Miami Botanical Garden and teach 300 kids how to make our pizza. 

     

    Now we didn't have you know, I was at a pizza man salary. So we didn't have the funds to do it. And we said, if we could go on to GoFundMe and people will like, give us the money that we need. We'll give it two weeks. If it works, then we'll do it if not, whatever, not the end of the world. We were completely funded in two days. So we kind of just like literally went Oh crap, we have to do this now. The event was amazing. We got our first press coverage. And that was the first moment where we went from “do we open a pizzeria or do we create just the cheese?” And the reason we had that thought is because the parents of these kids kept on coming over and stealing slices from their kids and going “Oh my God, if this was in the supermarket, if this was a frozen pizza, you would completely have us as customers. This is what we're looking for, something without soy or nuts, that tastes this good.” 

     

    So we got accepted into the Hot Bread Kitchen Incubator here in Harlem. And they kind of helped us with our business model. And then they went “Okay, if you're going to open a pizzeria in New York City, how much would you do?” And I did the numbers, I crunched the numbers. I worked in a couple restaurants here and I went to the right neighborhood. You could grow to around 3 million a year. And I was like, really happy about $3 million. That's a lot. And then they went “okay, how much is your competitor doing in the plant based cheese space?” And I looked up the internet really quickly and they were doing 55 million a year. So they went “Don't you think that's a lot of pizzerias?” and I agreed with them. So what was great about being part of that incubator is that they helped us take our business model from opening a restaurant and establishing a food business.

     

    So we went from looking for investors and real estate for that role and we started looking for food scientists joining a lot of different vegan organizations, making contacts in that world. And that helped us raise some capital from friends and family and introduced us to Kovac’s food labs. This is a cheese and dairy facility like food science development company, they're based in Ithaca, right next to Cornell University, there's a lot of dairy up there. When I told them I made a cheese from beans, they're like “No, he didn't”. And I was like, “Yeah, Yeah, I did. How do I mass produce this?” and they're like “Come over here. Let's test it. Let's see if that's even possible”. Once they tasted it and compared it to all the other products available, that idea blew their mind. So they helped us create a really amazing prototype that tasted exactly like artisanal cheese. We took that prototype and we were at the plant based food World Expo at the Javits Center in New York City. 

     

    Now how we got there was literally one night I was sitting on my phone, I  couldn't fall asleep, I'm scrolling through Facebook, and all of a sudden I see an ad for it and it's only a month away and I go “I have to do this”. And the next day, I got my tax refund and it was exactly the same amount of money we needed for the booth. So we just did it. And very luckily, I don't know how familiar you are with the plant based cheese space, but we have one company called Miokos and the founder is like the Martha Stewart of our world. And for some very lucky reason we ended up being directly across from her. So we didn't have to do any marketing. We just needed to stand there. And everyone who flocked over to her booth turned around and saw us.

     

    So one of the funds that saw us was big idea ventures, they got really excited about the potential of the product. And they saw all of the types of orders that were trying to fulfill all the different companies that came to us, they brought us into their first cohort, their first accelerator, which was exactly a year ago, they gave us some money. The biggest thing that they did for us was at the time, we thought we would have to create our own facility, because when you're small, no big factories are going to work with you. But because of their connections, they connected us with a really amazing facility in Wisconsin. Everything I fantasize as far as machinery, and like how to slice it really quickly with robots and all of that that I thought like if we're going to do it ourselves I would never be able to afford, they had it and going to their factory it was like just the most amazing moment of my life. Like I teared up a little bit. And this is the result of five years of extensive research and development. 

     

    And what's great about this is that pizza is just our proof of concept. We realized by analyzing all of our different prototypes that what you need to do for a plant based pizza cheese to melt is completely different than what you need for burger cheese and we noticed that nobody else has thought of that because burger slices in the plant based world, they just don't melt at low temperature. Everything was developed for pizza, which is the high temperature oven setting. But if you've ever tried to cook a cheeseburger or Beyond Burger with vegan cheese on it, it just stays in the shape. And that's frankly just not good enough. So we're in the process of developing a faster melting plant based cheese. And the reasoning behind it other than our high standards is because right now, Impossible Burgers are available at Burger King, but you can't get it with vegan cheese. And that has to do with the time that it takes for it to melt. So having a faster melting cheese allows big QSR, is big quick service restaurants to put in this new product without having to change how they cook burgers. 

     

    The demand is growing every single day. I don't know if anybody heard but McDonald's is about to release the MC plant and that's going to be a huge game changer in the United States. To supply that demand, we've partnered with a facility that is capable of producing a million pounds of Pleese a week. So it's not just something that me and a couple of friends are doing in our garage. It's a huge facility. The scalability is there, we can handle any sort of demand, which to me is just mind blowing to go from our kitchen to an actual factory. We are a team of entrepreneurs, my wife and I, as I said, this wasn't our background, but we are very determined people, that's a nice way to say it. And we don't let anything stand in our way. So when we realized that the challenge was there, and that people really wanted it, we took it upon ourselves to do that. 

     

    My background as a sales director was working in a jewelry company, I got to see a piece of jewelry get drawn on a piece of paper and go through the factory and all the different iterations. So I had this understanding of what it took to go from a prototype from an idea to the final consumer and my role in life was to sell directly to that final consumer. I helped that company grow their sales by two, which is like 200% in two years. So I definitely have that experience. And thanks to the different accelerators that we’re in, we were able to create an amazing team with a lot more food experience than us. And Sergio, who's our operations manager, is the person who helped us find that factory. So he completely changed our lives. 

     

    We're so grateful that he's part of our team. Like I said earlier, we started this whole journey thanks to Hot Bread Kitchen. This year, we also got accepted into the Harlem local vendor program, which is a partnership between Columbia Business School and Whole Foods. They basically found companies like us that represented the best of what Harlam has to offer, and position us where we can really sell and learn from different supermarkets that are specialized in this field. So we have some amazing mentors. And I'm taking the same classes that most MBAs take at Columbia, included as part of being in this accelerator. 

     

    Before COVID, we've had a lot of amazing expressions of interest. The most amazing one to us was from Bon appetit management. They work with a lot of campuses and headquarters of huge organizations. They wanted in April to do a launch test with us both at the Metropolitan Museum of Art in New York and at Lincoln's headquarters. Now, unfortunately, that didn't happen. But back to being a very determined person. I am not a type of person that just waits for life to happen. I make it happen. So we took all the samples that we had created right before COVID, we did our first batch that we tested, we went from our homemade or shared kitchen made to a factory batch that was supposed to go to these different organizations. When we found out that wasn't going to happen, we didn't know what to do. So I took a whole bunch of pictures of our cheese on pizza and I just put it on to the internet and I put a challenge ahead and I said “if you want plant based cheese to become the new normal, all you have to do is find a restaurant that wants this” and we got amazing traction all over the country. 

     

    Now we're expanding and it's really growing. Now we've put our product in front of some amazing chains. So we'll see how this next two weeks roll out. I just wanted to go back to this slide. Again, it's the height of pandemic, everyone's panicking. I'm with my family. Their business is closed. Nobody knows what's going to happen. And I'm just sitting there and I'm itching. I'm like, I need to do something, we were about to launch, I need to get the word out. And I literally youtubed how to write a press release, and sat there, wrote it out over a night or two, sent it to a friend, they approved it and I just started sending it to different publications that I read. And those ended up escalating. And for instance, Veggie News that has been really helpful to us. I didn't send one to them. They actually reached out to me independently and wrote this amazing article. It's one of those tear up moments we’re like “Oh, my God, this is about me”. And it just kept on growing and growing. And I couldn't believe it was just like me futzing around on the computer and all of a sudden, people have heard of us all over the country and we had over 30 million impressions over the last six months. 

     

    So what was really cool about working with Veggie News is that they convinced me to create my first ad. we realize that word of mouth was really the driving force behind our brand. So we got page three over here. And like it says over there, the whole idea here is how do I get restaurants interested in my product. And again, the consumer who's looking for this product is very local. So they helped us push and get us into restaurants. We figured we continue the same kind of effort. So this magazine dropped three weeks ago, we've handed out 100 different samples all over the country. It's really exploding. It's becoming so big and our first official launch was Labor Day weekend, we only tested in four markets. Two of them were completely vegan restaurants. And two of them were not, one in New York City and one in Salt Lake City who are not completely vegan. Everyone sold out, the vegan restaurant sold out in an hour, the non vegan sold out over the weekend. And what was exciting about, especially the New York pizzeria, was that it was Labor Day weekend and New York City was empty because of the pandemic, but it's really empty on Labor Day weekend. And the owner of this restaurant, he's like, “I'm not expecting anyone to come. Don't worry about it. This will be here for the week. I'll always help push you”. And then all of a sudden, like this huge group of vegans came from around the corner and started asking for the product and it just blew the owner away. 

     

    So his brother owns three other restaurants and he saw the traffic. He saw all the like that his brother actually made money on Labor Day weekend. And he got really excited and he added us to the menu to have the highest and authentic napoletana pizzerias. So Tommaso you have to come try in New York City, and he also owns Rocco's pizza joint, which is one of these, like 50s inspired pizzerias in Chelsea on 20th Street. And he was blown away by all the different types of people that are coming in and asking for the product. So we're hoping to do a launch with him in veganuary and change one of these stores where the shops it's completely vegan. So fingers crossed, we'll be able to make that happen. 

     

    Most latest excitement in our lives is that about a month ago, we got accepted into the food bytes by Rob Rabobank mentor event. They had something like 400 applicants, they picked 45 in different categories, we were in the CPG category. And we did this huge pitch online. And this week they let us know that we got accepted in the top 15. And that's actually going to be really exciting, it’s December 2, if anybody could come and see it. And our growth strategy has been very interesting. We have demand from a lot of different areas, but we want to be very smart about our expansion. We could tomorrow make 1000s of pounds, but that doesn't help us if we don't have the right demand and distribution and the right people in place. 

     

    So what we've learned from companies like impossible and a lot of other different companies out there in the market is that food service is a great place to start. You get the market demand up, you start your branding efforts, you get people asking for your product pizza with extra Pleese. And you also have better margins and food service, we have 75% margins. So it really allows us to grow our infrastructure as a company. Now we get demands from direct to consumer every single day. My whole mailing list is people asking me when they can buy it online. We're hoping to launch online this winter. So that's going to be very exciting and then we'll have really direct measurable results. Grocery store is where we're really going to grow our business. Earlier, I mentioned that this industry is going to be worth $7.5 billion in the next decade and most of that growth is going to be coming from home consumers. So we definitely started this whole thing because we know the home consumers who want us, and that's where we're going to really grow our brand. So Hi, everybody. If you want a slice of this market, all you have to do is say the magic words, Pleese. Thank you.

     

    Go to market strategy

    Tommaso: Kobi, I mean, what should I say? You're pitching to an Italian, so you had me at your first slide showing a pizza. Congratulations, I really love your passion. And congratulations on your endeavor. But now before I go into my question I would like actually, and I'm really curious to hear Alan and Dheeraj thoughts and questions around the business. We love the mission and the passion you have. But maybe Alan, what are your thoughts about that?

     

    Alan: Sure. Thank you. Great job, Kobi. Yeah, awesome presentation. The things that stood out to me was specifically that it was cheese to begin with. Because as Tommaso was mentioning, I have a background  in incubation. So I used to be part of the Provenge Incubator, which was the leading plant based focus incubator in Europe. I know you were part of VIB, so we know each other quite well through the work that we do. And basically, we get applications from all over the world, and so many people are trying to do cheese, so many we're trying to do cheese, and for us it was really tough to make the call on it. Because, I mean, a lot of times they're cashew based, and yes, it's an allergen. But at the same time, it's super hard to scale, it's expensive, the supply chain is funky. So knowing that you went through being a potato, I mean, you kind of cracked the code here to the cheese, because there's something that everybody wants to have, and there's no good options on it. And for you to have been able to come to a product that is super tasty, melt, and then on top of that have really good margins. 

     

    It's pretty much satisfying all the needs that need to be met with this kind of product. But I wanted to ask you more about the about the go to market strategy, because you were mentioning interest throughout the country, and it seemed like it was first  bottom up kind of approach tackling the mom and pops and then kind of growing bigger, but at the same time you're  targeting already these big fast food chains. So what would be like the ideal trajectory for you? I mean, how soon would you want to get into these fast food chains? And how would you be able to lead these efforts simultaneously between setting up a direct to consumer shop, but at the same time managing how this growth goes throughout all these different fast food chains and mom and pop shops as well?


    Kobi
    : Oh, thank you, and thank you for because you have experience in this you completely understand what it means to crack that code. I mean, cashew is a great product, we've had a lot of success with it. But it's expensive, and the price fluctuates. And there is scarcity in the market. So that was one thing that we were really worried about when we looked at this, even just starting with our pizzeria. But to get back to your question, we want to work with a mom and pops because we know how it feels to have your favorite pizzeria. It's not always going to be Domino's or Pizza Hut or whatever. I'm that type of guy that in New York City, before I was vegan, called me didn't matter what time of day and you were you asked me “where can I get a slice of pizza? and I'd know where to get it. 

    In New York, we don't go after those chain  pizzeria. It's just about how does Larry's pizza and how does Vetoes pizza tastes. It's one of those things. But obviously, if you want to succeed or be as big as we want to be, and if you really want to change the world, you're going to have to work with the chains. We're hoping to begin some tests for Veganuary. So that's vegan January, which is just right around the corner. And what's great is that we have the capability, so if a Domino's Pizza or even, if I'm sure you've been reading the news, Pizza Hut in the US and the UK just added the Beyond Burger sausage I think as a topping, but at least in the US they do not have a vegan option. 

     

    Now, again, this is something I said earlier, I have always been looking for a vegan option because  I'm vegan, that's my choice. But there are over 100 million people in America who have serious problems with dairy and soy. And that I think is kind of a shame for these really big chains who have adopted plant based options in other countries, specifically in Europe, and in Australia, and in Asia, but in America, they haven't even bothered. So just having that option for Pizza Hut, I think would be game changing for them. So we have the capabilities, we have the desire, we would do a test immediately if they gave us the opportunity. And it's really just about satisfying as many customers as possible as we grow our brand. Does that answer your question? 

     

    Alan: Yeah, it definitely does. And I agree with you. I mean, the times that I've been in New York. I mean, these mom and pop shop, pizzerias are the places to go. So yeah, and all the more reason to make it back to New York as soon as possible these days.


    Kobi:
    And just on that subject, it's so funny to me. So I'm really after Pizza Hut right now. And it's kind of because of a funny thing that happened to me when we were doing that event in Miami. We were testing pizzas the night before, at this restaurant, and we just handed out free slices. And we're in Florida. So Florida, New York's very culturally mixed, you have people who are very particular, we don't have so many chain restaurants all over the city, and I'm handing out the slices and somebody took a bite and they went “Hmm, this is so good. This is like Pizza Hut”. And to me I'm going like “What? What?” And then I stopped myself and I was like “Oh, wait, no, that's a compliment”. They don't have all the access the way we do. Now because that happened, that's why I'm completely after them.


    Alan
    : Nice. Awesome. Well, best of luck with it, Kobi. Keep up the great work and awesome work you've done already.

     

    Value proposition

    Tommaso: Thanks, Alan. Thanks, Kobi. Dheeraj, what are your thoughts?

     

    Dheeraj: Yeah, Kobi. Firstly, congratulations and great presentation and great work that you guys are doing. I think somebody who mentioned that it was soon early in the cycle that you were able to understand the difference between different types of cheese actually, and with this then you started focusing on pizza cheese, and then the burger cheese and the sandwich cheese. So great to hear about that. I think my question to you actually would be around,  I think extending what Alan said about your value proposition for these three different product offerings that you have thought about it. And secondly, what is the sustainability story that you are putting along with the cheese? Actually, it's vegan. But I believe that we need to look at, we're talking about 2050, and going forward. So have you ever thought anything about that? 

     

    Kobi: Yes, I'm actually going to answer that question first. And I'm kicking myself because I changed my old presentation slides to fit with the whole story, because I had longer to talk today. But if you go onto my website, for every case of Pleese sold, we donate, or we plant one tree at the National Forest foundation. And one of the reasons behind it I was filling out an application. Anytime there's a pitch event or something, I'm always filling out the application. And I'm sitting there one night, and they have the same question, “what's the sustainability angle?” and I knew our product was more sustainable, but I didn't have the math in front of me, so I looked it up. And for one pound of cheese, you need 10 pounds of milk. To have 10 pounds of milk you need a lot of cows and there's a lot of environmental factors that go into it. 

     

    So actually cheese is the third largest contributor to climate change around the world after beef and lamb. I think it was, that number I don't have in front of me, I think it was like 20 kilograms of co2 is produced per pound of cheese. So I did them, whatever that number was, I did the math, and I found out that a regular pizzeria mom and pop shop, like Vetoes that were in in New York City, just from buying their cheese, they're creating almost a ton of co2 per year, not on purpose, just because that's the product that they sell on top of all of their pizza. So when I saw that, I was like, “Well, how do you get rid of co2? You plant trees

     

    When I found the National Forest Foundation, they put the numbers in front of me, and they're like two trees will remove a ton of co2 per year. And so I went “Okay, so for every case that we sell, we'll be able to really make a meaningful impact’. And that's kind of the first thing that we're doing in our sustainability proposition, we're changing the demand for regular dairy, we're changing, and we're using the infrastructure of dairy factories. So what's very innovative about our product is that we use the same machinery without any casein. If you're out there in the world, they don't know what casein is, it's the protein that comes from milk. And it's also what makes people allergic to milk. It's just this protein that gives you the stretch and all that it brings it all together. So what's innovative and special and different about our plant based cheese is that using completely different ingredients that are completely natural, made from plants, no animal by products or anything like that, and using the machines that were developed specifically to work with casein, and all the stretching, and all of that is very special. 

     

    So we don't need to create a brand new infrastructure, we don't need to create new factories, we can go to different countries, and we can buy an old factory and change some of the inputs, clean it up, make sure it works. And just use the available infrastructure, which I think is game changing. And then the last thing that we're planning on doing and this is why our CPG rollout is a little bit longer. This is just like the secret sauce that I'm only telling 15,000 people is that we want to create and have sustainable packaging. Now, refrigerated packaging, especially with the cheese, especially if you want a window, they're very thick, and they're not recyclable. You want them to be recyclable, but they are not. And there's a company, I think they're based in Israel called Tpath, and they have created a very innovative way to build the packaging where it deteriorates, and it could be just thrown away, and it deteriorates in a way where the microbes that are in the trash dump can actually eat and buy degrade the packaging. So most people, especially if they have busy lifestyles, if they have a restaurant or whatever, if they see plastic they throw it away. That's going to be in the landfill forever. But our packaging is going to be able to be part of it and more sustainable and biodegrade. Yeah, and just one other thing that because you're in India, what I found really fascinating is India is the second largest pizza market in the world. Domino's is definitely, that's their second largest territory, I think they have 12.000 locations. And also most of the ingredients to make plant based cheeses come from India. So one of our goals in the next decade is to hopefully build a facility or reclaim a facility in India and use that to grow this market in Asia because it goes back to people who are lactose intolerant. There's a lot more people who are lactose intolerant in Asia than in America, and we want to help with all of that and use the ingredients that are available. 

    Tommaso: Outstanding. very intriguing. The more I hear the more I want to know, Kobi. So that's really cool what you guys are doing. What's the barrier of entry? What are your thoughts there? How difficult is it for others based on your knowledge and people following you say “okay, he got the formula, we know we want to do the formula. And let's let's put you some more brains to it right? What are your thoughts there, Kobi?

     

    Kobi: That's a funny question that answers different ways on different points of that timeline that I showed you earlier, what I think is fascinating, and this happened at our plant trial. I have messed up so many times. And that's what experimenting is, it's messing up and trying again, and messing up and trying again, and learning what you did wrong, and fixing the problem and then having a quick solution and then innovating from that point onward. So we got to the factory, I've been working with these top level r&d teams, the most professional PhDs, people who know everything about food science and in order to scale up our product, whatever we created at home is not something you can make in a factory, our product that we made at home had a two to three week shelf life. Now with the facility and the way that they process the packaging, they get rid of the oxygen and they put in nitrogen, we can get up to between four to six months. We're still testing it. So we're hoping to get to six months. 

     

    But back to the barrier of entry. It's a lot of time. It's a lot of effort. A lot of people have tried, a lot of the experts in this field right now haven't really been successful. I think where I've stand out is how particular I am about certain things we've gone through at this point, maybe 40, 45 different prototypes, different versions, and it costs a lot of money, but it was worth it because we've definitely changed the game. So if anybody's had a vegan cheese out there, the most popular one I mentioned earlier, I'm not going to mention him by name, they come in a white package. And they're the most popular one in the United States. It's very top of your mouth sticky. These products are made mostly from starches. Tapioca is one of the biggest ingredients. We don't use tapioca. That's another thing I didn't mention. But tapioca is one of the starches that kind of brings everything together. And it's very sticky to the mouth. So some of them melts really nicely, but they're sticky. 

     

    So the first company I mentioned is sticky from the back of your mouth. The other company just sold for 500 million euros. They're based in Europe. And they are an amazing company, my hat goes down to what they have created. They use green packaging, we'll just use it like that, melts very beautifully, sticky on your teeth, teeth sticky. And as someone who misses pizza wants the authentic experience, that wasn't good enough. So we just tried and tried and tried and tried and tried and put it in front of as many people who aren't vegan. A lot of kids, kids will tell you the truth. They'll tell you if it sucks.

     

    They'll hurt your feelings, but they don't care. And when we got to the point where they liked it, and we did something like it was good. We knew we've really changed it. So back to what I was saying. We did our first test in the factory and I flew from New York, the factories in Wisconsin, yes, Wisconsin, and I got there late. They had done a batch and they showed it to me and I won't get into what the problem was, but I saw the problem in the sample and I looked at it and I went you're missing this one ingredient. You don't have this one ingredient and the scientist looked at the list and he's like, you're right, but I have some in the back and he ran and got that ingredient. We put it in the mix and it came out perfectly.

     

    It was the best batch that we did for the entire day. So that day was rainy. I had to switch in Detroit. I wasn't sure if I was even going to make it because it was snowing in Wisconsin. And I thought maybe I'll just go home. And something in me went “Okay, nevermind, if I get stuck in Wisconsin, it's not the end of the world”. And that test happened and I solved the problem, and I got home. When I got home, around midnight, I was thinking about that whole experience. And I went “Holy crap! Am I an expert in this field?” Like, am I one of the world's leading experts in plant based cheese? Did I just solve a problem that the scientists didn’t know how to solve? Did I do that? And so yeah, so now I'm officially one of the experts in this world that knows everything about plant based cheese. And as an expert who's done a lot of this, I can tell you that the barrier is very high. 

     

    So people will come in, and they will create similar products, but I don't think they have the same type of tenacity, or the willingness to go better than just good. 

    Tommaso: Congratulations on your persistence and your curiosity to experiment. What are you pricing wise compared to the others?

     

    Kobi: So in food service, we are more affordable than everybody else. One of our competitors, they use palm oil, we refuse to use palm oil, they're $1,20 per pound, more expensive than us. And that was really important for me, if I knew in food service we needed to really have a very affordable competitive price, we're still more expensive than regular cheese, but we're more affordable than what's available on the market. And then because we did a lot of market testing with different types of packaging, different types of logo designs, etc, we found out that we could actually get a premium on our product. And so we wanted to price originally at $4,99, and we found that people thought they should be paying $5,99. And I'm not going to argue with what people think. 

    Tommaso: Yeah, that's no argue with getting more money, right? Competing on price is solving any problems, right? You're really solving a challenge, a health challenge and I mean, this sounds a great story, but what keeps you awake at night? So what is your next big achievement as an entrepreneur? What's the next big milestone?

     

    Kobi: I would love to finally raise the seed round on that. When we're looking for anywhere between 1.2 or 1.5 million.

    Tommaso: Where do you get to with this money? 

     

    Kobi: We get to build our team, we get to finish the development of our products, because there's a lot of r&d that's still left to scale everything up, we get to expand. There's a lot of brokers that you have to deal with to really expand your share of the market. So we get to go into those systems, as opposed to like knocking and hoping “oh, can you please accept me?” like we get to actually get in there placement, like things like that, that we get to do. And then a lot of it's going to be PR efforts, I just noticed that marketing first and getting product in front of people, getting the imagery in front of people is really important. And it's creating the product and ordering enough ingredients. And one of the biggest things is that we're in the process of patenting our product, it's one thing to pad in it, it's another thing to defend it. So creating, having the right legal team on board to help us defend it...

    Tommaso: Editing a food is pretty challenging, right? Is it any ingredient side or is it on a process side?

     

    Kobi: It's on the process. Ingredient side is a little different. If you're doing something very innovative and you're doing it in an innovative way you can actually get a patent for it. So I think Impossible is completely different, but beyond is a very basic recipe but because of how they're doing it and what they're doing, they were able to get a patent. So that's the type of world. Because we know that it's possible, we're going to go after it. 

     

    Tommaso: Kobi, thank you so much for your time. Alan, Dheeraj I could go on and ask and maybe start tasting one of those pizza slices, but it's 9:30am in the morning. I want to be respectful of everybody's time. Congratulations on your endeavor. I always humbly love when I learn from Alan, learn from Dheeraj. Kobi,  great story. 

     

    I would like to bottom line this on November the 12th 2020. We have Kobi with an amazing story, mission, vision, about being a global leader in alternative cheese and I want to put you actually on a bigger challenge, which is you were talking about New York and pizza. And I'm Italian, I want to put you in the Italian hands and see what they say about your cheese. So that's basically I think a challenge I want to try out. Well, thank you so much. 

     

    And we don't end our broadcast without finalizing it with a quote. The quote is one that I learned to craft as an entrepreneur, and became an investor part of academia which goes like this:

     

    Tommaso: “Never forget where you come from, it keeps you humble. But where you come from, cannot limit you where you want to go.”

     

    Well, I would like to thank you. Thank you for allowing us to pick your brains guys. I know your time is very precious. Alan Allen, Dheeraj and Kobi, I wish you a great rest of your day. And let's keep on changing the world. Bye bye.

     

    And this series is brought you by:

    Awesm Ventures: A VC that unlike others, invests exclusively with and on behalf of corporations in fragmented industries. http://www.awesm.ventures  

    SiliconVal.ly: The Innovation institute focused on helping future-proof corporations in traditional industries. http://www.siliconval.ly .

     

    This is a proteinX Series. http://www.proteinX.org   

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