Why Brain Health Is Patrick Schwarzenegger’s Latest – And Most Important – Investment

Food & Drink

Over the past decade, Patrick Schwarzenegger has been one of the most impactful investors in Consumer Products. After the success of his first investment, Blaze Pizza, Schwarzenegger has gone on to be an early check in breakout successes like Super Coffee, Olipop, and Liquid IV. In his latest investment, he’s turned to the role of founder, partnering with his mother Maria Shriver to launch MOSH, the Brain Brand. I sat down with Patrick to discuss how he started investing in consumer products and why launching MOSH was always the ultimate goal for him.

Dave Knox: Before launching MOSH, you were very active as a CPG investor. How did you find yourself on the investing side of brands?

Patrick Schwarzenegger: Really I started as an investor because I was a frustrated customer. I grew up in a household where we weren’t really allowed to have the junk food. We didn’t have Cocoa Puffs and Reese’s Peanut Butter Cups, or Starbucks Frappuccinos with 40 grams of sugar. My dad was very conscious about what he gave us kids, and about the food that he put in his body. And I remember when I started to get into working out, I was kind of shocked at how little options there were out there that were delicious, but also nutritious and really good for you. I made it my mission to go out there and look for different products that were offering customers a better for you alternative. Something that was healthier, less sugar, more protein, and cleaner ingredients.

And investing started as an accident. My first investment was one called Blaze Pizza. I had no idea about investing or about operating a business. I didn’t know anything. But I was working as an intern for a guy named John Davis. And he was a film producer, and I knew I wanted to do film and business. And he had just exited out of a company called Wetzel’s Pretzels. And they were like, “We’re going to start to work on the Chipotle for pizza, the Subway for pizza. And we want it to be very transparent with where we get the ingredients and allow the customers to pick the ingredients and have it made right in front of them.” And I was like, “This is perfect. This is exactly what I want to do. This lines up exactly with how I want to learn about business, I’m gonna invest.” And that was the first investment. And that company grew to almost 400 stores. And I was like, “Wow, this is easy. I just made millions of dollars off my first small investment. I’m gonna do this forever.” And so, I sold out of that and put all the money towards other companies. And it was not as easy as that company was, but it’s been a great time since.

Knox: That first successful investment was in the restaurant / QSR space. Why did you move from that to Consumer Packaged Goods?

Schwarzenegger: Once we sold Blaze and I had my own real money, I was in a unique situation. I was 20 years old and in college studying business. I just made a lot of money. And my generation was the generation that was not only focusing on the ingredients in our products but also one that was starting companies to solve the problems. I decided to go search for other young entrepreneurs and the first one I really ran across was Super Coffee. They were three brothers in their dorm rooms with the idea to tackle the Starbucks Frappuccino, to offer an alternative to the 40 grams of wasted sugar.

I really didn’t know much about investing, CPG or the beverage space. But I really believed in them and their mission. And I was becoming a coffee addict myself. And so, I invested and went on the journey with them. Now that company is doing over $100 million in revenue and has been a fun one to watch. I didn’t have a planned route to go from fast casual restaurants into a bottled beverage. It was just sticking to the passions of what I wanted to get involved with, and the people that I wanted to get involved with. And it’s slowly grown from there.

Knox: Since that first investment in Super Coffee, how has your approach to investing evolved?

Schwarzenegger: Well, it’s completely changed. The whole industry has completely changed. The amount of competition has completely changed. One of the beautiful things about entrepreneurship, and about this space is that anybody can go, and start a company. I’ve heard of tons of success stories of people starting a popcorn company outside of the stadium, and it growing to becoming the BOOMCHICKAPOP. Or you hear about RXbar, where they’re starting it in their kitchen. Or Super Coffee where they were first blending it in the dorm room. The beautiful part about this is that the American dream is very alive and well in the CPG space. But that means that a lot of people are going to go towards it. And today, I get sent brands almost every day. It used to be once every few months you’d get a cool brand. Now, it’s almost daily I get a new brand. So, I’ve had to be more rigorous with the processes of investing. But it really comes down to that I have to believe in the entrepreneur behind it and their mission. I have to believe in the actual product and it has to be something that I would use. And it has to be really applicable towards mass America, something that’s not too extremely niche, but something that can be for the masses.

Knox: After six years on the investing side, what made you want to launch MOSH and move into being on the operator side?

Schwarzenegger: Truthfully, it was always part of the plan for me. I wanted to approach this better for you, health and wellness space and prove out that I could make investments that were successful. Prove that it’s a growing total addressable market and that big companies are buying some of these smaller companies because they lack on the innovation and execution. And then I wanted to take my learnings and go create our product lines. Create something where we could own 90 percent of the company and use the connections we made in manufacturing, branding, and go to market to launch the company fast and self-finance it. Founders have to spend too much time fund raising instead of on the business itself. I wanted to be in a position where we didn’t have to do that, and I could really focus on building the company.

With that as background, when COVID started I moved home with my mom. She has dedicated her life towards Alzheimer’s and towards brain health research. A lot of those activities came to a halt with COVID. We talked about his unique moment in time where things were on pause for both of us and we had an opportunity to create something meaningful and launch a mission driven company where could educate people on how what they eat and drink impacts their brain health. And so that’s what we did, launching the business out of mission that was at our core.

Knox: Where did you start as you took the first steps in building the brand?

Schwarzenegger: We went as granular as possible. On the packaging, the colors and the actual gradation on it is derived from a brain scan. We wanted everything to stay true to the mission. The important thing was to communicate to consumers that we weren’t creating a product that was going to cure anything. It wasn’t going to prevent Alzheimer’s. But we wanted to show people that there are things they can do today that will help their brain health tomorrow.

And food is one of those things. There is a “mind diet”. There’s something about eating less sugar, eating flavonoids, and eating high healthy fats that lead to healthier brains. That became a foundation of creating a product with no sugar and incorporating specific vitamins that were beneficial for the brain like vitamin B12, and B3. We wanted to have good, healthy fats like flax seeds, and chia seeds, and almonds. We wanted to have protein, and we wanted to have some of these other newer functional ingredients like Lion’s Mane to speak towards a brain healthy diet.

Knox: With all of this thought into the product and packaging, what led you to launch in the bar format for the first product?

Schwarzenegger: My mom is addicted to bars. She had to give them up for Lent even – that’s how addicted she is. Launching in a bar made the product true to our story. It wasn’t the best thing to do regarding margins, and the competition in the bar space. However, it was exactly what she wanted to do. But we’re not trying to be a bar brand. We’re not trying to be a protein bar brand. We’re trying to be a brain health brand and create different product lines that speak towards that. So, we have a lot of things that we’re working on ranging from other flavors of the bars to supplements to powders, and other things that all speak towards brain health.

Knox: How has launching through Direct to Consumer impacted the business?

Schwarzenegger: Well, you have to remember, we launched the business at the start of COVID. Retail was down double digits year over year and the bar space was down over 20 points year over year. We also didn’t know if customers would care about eating for their brain health. And we had bootstrapped the launch without outside funding.

We wanted to do direct to consumer for a couple reasons. One, to find out if there was proof in the concept. Number two, to be able to communicate with our customers and figure out what did they like, or not like about the product before we went into retail. Three, we wanted to figure out more information about our customers, who the demo was, who was buying it, why they were buying it, and what other product lines would they be interested in receiving from us? What were the biggest issues that they were having in their daily life that we could help take care of for them when it came to brain health? And those things, and the communication we can have in the community we can build is way better, way easier through direct to consumer than it is in retail. So, those three reasons were the main ones of why we started direct to consumer. It’s in our intent and it is our goal to go to retail probably next year. But we had a very clear path of how we would get there, and what the best route was to continue to speak with our customers before getting there.

And this communication has worked really well for us. We sold out right away in the first day. When we relaunched on Giving Tuesday, we did double what we did on our launch day. And then, we sold out again. And I think people were just really interested in the mission and why we created the product, and the give back. And on Giving Tuesday, we doubled the donations. And in the last year we donated over $20,000 between me and my mom and MOSH when we doubled the donations. So, that’s really cool. That was our dream. And that was our goal was to create a company that was good for the customer, good for their brain, that educated them about brain health. And that also gave back. And we wanted to prove to other people that you can do a mission driven company, that you can have a for- profit, but also give back and raise awareness.

Products You May Like

Articles You May Like

The world’s most alarming airplane landings
The Idle Rocks Is Cornwall’s Best-Kept Culinary Secret
The loss of Chinese tourists is devastating destinations – from Bangkok to Bicester
Fresh Take: Hunting Invasive Lionfish In Dominica, A $4.5 Billion Chicken Industry Consolidation, And The Moldy Grain Coming Out Of Ukraine’s Black Sea Ports
Athens: What NOT to do in Athens, Greece

Leave a Reply

Your email address will not be published.