#9 Michael Colangelo: Accomplished Flavor Chemist and Beverage Product Development Consultant

Micheal's LinkedIn: https://www.linkedin.com/in/notabeneflavors/

Nathan's LinkedIn: https://www.linkedin.com/in/nathan-schmidt-810756139/

Website: progressusolutions.com

Transcript

SPEAKER_02 0:00

Welcome everyone. I'm Nathan Schmidt, the host of the CPG Level Up Podcast, where we bring CPG talents and leadership together to explore trends, elevate careers, and uncover strategies that power the products consumers rely on every day. Today I have the honor to have a conversation with Michael Calangelo, who is the founder of Noda Bene Flavors, an accomplished RD and flavor chemistry professional within CPG that started his career in flavor chemistry, then spent eight plus years in startup environments building out beverage RD teams, and is now the founder of an innovation consultancy. And in today's episode, we dive deep into the evolution of beverage product development, why strong subject matter expert consultants are the way to go for CPG founders, what founders need to expect about launching a successful product, and how successfully, how to successfully bring a CPG product to market. I hope you enjoy this episode and feel free to share with someone you think would find value. Michael, how's it going today?

SPEAKER_00 1:04

Oh, I'm good. It's uh it's a beautiful Friday. How are you?

SPEAKER_02 1:08

Good, good, beautiful Friday as well over here in Tampa, Florida. Um, it's actually very hot today, as usual in the summers, but uh but appreciate you coming on the line here with this episode of the CPG Level Up Podcast. Uh why don't we start here, Michael? Why don't we just start with you just giving an overview of yourself, your career, your specialization, and we can we can go from there.

SPEAKER_00 1:35

Sure. Yeah, thanks for having me. Um so just a little a little background. Um, so I I come, you know, originally by this industry via uh chemistry. So uh got a chemistry degree, worked in analytical chemistry for a little while, and then kind of fell into flavor chemistry at Jividon. Um, just got a lab job there doing technician work, and then I've just sort of followed that pathway. Um, so learned all about flavor chemistry and creating flavors and and kind of learning how that you know piece of this industry works, and then moved to California to work for a small flavor company that was starting up, just getting their start and learned kind of about the business of flavors, and then um, you know, kind of moved into startups and and I've been working in startups ever since. Um, so I've I've worked for companies that did molecular beverage technology, and I've worked for companies that were doing de-alkyzed wine. And um, and so after a while of kind of working and running, you know, labs and teams um for various startups, I I struck out on my own to uh start Notabene, um, which is really uh an innovation consultancy. The idea being that you have an idea for some sort of beverage or food product and you need help, you know, turning that into something that is real and scalable and helping you build systems that can help you, you know, mitigate risk or problems. Um and so the whole idea behind the company is really to you know help new founders and help new companies take something that's just been in their head or on paper and turning in into something that's in a can or in a package or in a sachet or a stick pack or whatever.

SPEAKER_02 3:21

Awesome. That's amazing. And with a lot of your expertise and flavor, uh, would you say the most of your work has been with that in regards to like more beverage product development? Or are you pretty well diversified with product category specifically?

SPEAKER_00 3:37

Yeah, primarily um, it's primarily beverage work. I do a little bit in supplements, I've done some in candy and snacks and bars. Um, but the majority of the work is in beverage. That's where the majority of my career has been. Um, and so that's definitely my expertise um in all types of beverage, everything from you know, as simple as uh, you know, carbonated seltzera water to you know energy drinks to protein drinks to, you know, you name it, functional mushroom, nootropics, yada yada.

SPEAKER_02 4:12

All the all the things in between. Yeah, I know a lot of people that I am connected with and even some clients that I serve. Uh I I have heard it said, I haven't formulated a product a product myself, but I've heard it said that beverage product development is a totally different animal compared to just maybe just normal food or um even nutraceutical in some regards there. So we can definitely tailor a little bit of our conversation in that regard. But with a lot of your expertise then, um how have you uh seen the beverage product development space evolve over the last handful of years?

SPEAKER_00 4:50

Yeah, that's a good question. I think there are two main ways um that things have shifted. And one is on the like brand customer-facing side, and the other is more back-of-house product development. And on the brand side, I think it's it's all clean label. I mean, at this point, um, you know, a lot of what we do, a lot of what we create, consumers have a hard time understanding the ingredients, the processes, you know, what makes their food safe for consumption. And that's put a lot of pressure on brands and on developers to, you know, try to make it easier for consumers to understand with signals on the package, like the ingredient statement or the nutrition facts panel, um, single signaling to them, you know, real food ingredients, you know, minimally processed uh beverages or foods. And I think, you know, that that puts a ton of pressure on everyone to make a product that tastes really good, make a product that's better for people, healthier, safer, whatever that might look like for your company, whether that's, you know, the removal of alcohol and putting in something functional that gives you some relaxation or protein or um, you know, hydration or whatever that looks like, but also making it in a way that's safe for them, you know, following proper FDA guidelines. And so I think that that's a really big trend that is only getting more difficult to follow because consumers are afraid of things that they don't understand. And so, you know, they're starting to become more inquisitive about things like natural flavors or, you know, buffer salts or acidifying agents, um, things that help make the product taste really good, but also make it safe to consume. And they don't have they're having a hard time connecting the dots between like why citric acid might be there to make the beverage acidified to be safe for consumption after six months or something like that. And so that that's the number one way. And then I think the other way, uh, the other trend that has has made this sort of world more difficult is the prevalence of AI and the usage of AI for everything. And AI is great for a lot of stuff. It's not really good at like developing a formula and building specifications and processes to make your product safe to run at a manufacturing facility and scale it and sell it. And so that that puts a lot of pressure on explaining what ingredients are there for what purposes, making sure that it's at the right pH or has the right water activity level or you know, any of those sorts of things that that AI doesn't quite have the you know connectivity and the understanding of because it's mining, you know, data that's publicly available on the internet. And and sometimes that stuff being proprietary information isn't out there for it to consume. And that makes it very difficult to discuss with founders who maybe don't, you know, have the full understanding of, you know, you need this much citric acid to get the pH to this level to make sure that you can run it via this process and put it on the shelf for 18 months and it's okay.

SPEAKER_02 8:12

Yeah. Yeah. What are the difficulties through the product life cycle that if if the aim is making it more and more clean label, like what are some of the I guess difficulties and obstacles that you have to really work through that in the past you may not had had to have put much thought into, if that makes sense? Like what about clean labels making it super difficult to formulate uh products right now?

SPEAKER_00 8:40

Yeah, I think the first way is your set of materials is is dramatically reduced. So your toolbox is smaller. You have less available things. A lot of those things come with, you know, what I would call baggage, right? So, you know, um in powder drink mixes, things like silicon dioxide, tricalcium phosphate, you know, flow agents, moisture control materials, you know, sound really bad to founders and so they don't want them. Well, the other ways to do that type of work include things like rice holes or, you know, expensive production techniques. And so rice holes come with, you know, off notes, taste like cardboard, but like it's got a really high silica content. So it really helps flowability of the product and moisture control, but it tastes really bad and it's not super soluble. So it makes your product not look as good when they dissolve it in water. It doesn't taste as good. Um, you know, expensive production techniques that drive the cost of goods up. And so that breaks a cost model that a founder might have been working on for six months to prepare for product development. And so, you know, there's all these other things that you can do, but it really shrinks the toolbox down and makes it much more difficult to develop a product. Uh, and then on the other side, it's product stability. Um, so if somebody doesn't want natural flavors, well, you might be able to make something that tastes really good for a month or two. But if you don't have natural flavors with the proper antioxidants or preservatives, that flavor degradation is sped up. And so you lose your flavor, product changes much, much faster. And that's not maybe necessarily bad for like food safety purposes, but for you know, enjoyment of a product that's been sitting on a grocery store shelf for eight months might not be the same as what it would have been if you could have used certain materials. Um, and so that can make it very difficult.

SPEAKER_02 10:39

Okay. Yeah, yeah, that makes sense. With that, maybe uh limit now of the tool you said toolbox. Um are are there, I I'm not too familiar with like the ingredient side of things. Are there like is there an evolution of maybe uh newer ingredients or like I guess newer tools for the toolbox because there are specific demands that need to be met? Like, is is is that ever changing and evolving um from a toolbox perspective? Or are you just pretty much it's like science, science, and there's really no new like ingredients that you can draft off of uh when formulating processes?

SPEAKER_00 11:18

No, that's a great question. Uh it's constantly evolving, and there's always new, there's always new ingredients coming out. Um, you know, obviously ingredient suppliers in particular, like if they're built on, let's say, preservation is their main expertise and goal. Well, sodium benzoate and potassium sorbate are being hammered in you know market trends and consumer research and all that sort of thing. So if that company is going to survive and evolve, they need to come out with new things, right? So they're constantly evolving. Some of those work, some of those evolutions, those new materials are great. And some of them, you know, can provide you um new tools that fit for purpose the product or the consumer trend. And then some of them don't. And so that makes, you know, formulators or innovators' jobs much more difficult because you also then have to, you know, screen those tools, right? So you have to have a, you know, you as a product developer, an innovation company or whatever, you have to uh have a separate pipeline or a separate project going that's really internal, that's not you know for immediate customer use, but it's for screening away things that are valuable. And so, you know, bigger organizations have groups dedicated to, you know, testing those things and finding out if they're viable and making sure um that you, you know, you kind of have that pipeline of new materials that can help with, you know, your client base or your customer base's needs, as where smaller outfits are maybe a little bit more pinched on on resources to be able to do that. So it it's tough, but it it is a constantly evolving landscape. There are there are tens of thousands of ingredients to work with. Oh, that's amazing.

SPEAKER_02 13:07

So okay. Yeah, for some reason, I just like in my mind, uh looked at like the ingredient side of things as being not super like changing and not really evolving, but I mean that's just kind of my limited exposure to the ingredient side of the business with a whole. So that's that's good. I mean, I'm sure that that gives hope to product developers as their as their toolbox may be decreasing. They they can still uh their options are evolving. So that's amazing. Uh, you touched on AI, and I I agree with that uh that your statement on the AI side of things. I do know there's a push for you know kind of like what you said, right? AI to be creating formulations and everything, but it's just early stages. Yeah, are you seeing that maybe at some point evolving to the point where AI will most definitely be like 99% accuracy with the formulation of like you know, assembling all the different variables and everything? Or do you think there's always gonna be a need for that consultance uh and some of the mind share that's going on there?

SPEAKER_00 14:12

Uh it's that's a good question. I think I I think there's always gonna be a need. I I think it'll depend on on how much of one, you know, one of the issues that I see with AI in particular is as good as it is with you know big data sets and everything, it's still a machine. It can't smell, it can't taste, it can't see. And so, you know, you're you're always gonna be limited by that, you know, sort of uh membrane between paper or computer exercise and physical product. Yeah. Right. And so at some point it'll have to, you know, any product that's being developed is gonna have to move into the real world from you know something that's hypothesized or theorized. And so it's it's gonna figure things out. It at some point it'll have enough data and enough understanding to like tell you how much acid to put in to reach a certain pH level. For some reason today, it can't do that. I have uh I play with it all the time and like test it to see like, you know, can you do this? And then I'm always amazed at how far off on pH it is. It's like add one gram of citric acid and it'll reach 3.2, and you add one gram of citric acid and it's like 4.8. It's not even close. And I don't even for some reason it just can't, it can't seem to figure that piece out, which seems really right up its alley. Um but um I I think at some point it'll get there. And I know that there are a lot of companies working on it, um, both you know, large CPG companies and and you know, flavor companies that are working on implementing AI tools. Um, I also know that there are companies that are pure AI trying to figure it out from a tech perspective. So it will happen at some point. Five years, 10 years, 20 years, I don't know. I think, but I do think that there will always be a need for humans to be involved because we're doing a very specific thing that is interaction with the human nose, mouth, you know, sight, see, touch. Um, and so you're you're gonna need that at some point. It won't ever be just uh put my brief in, it spits out a formula, I can send it to the manufacturer, it'll work perfectly.

SPEAKER_02 16:33

Yeah. Okay. Yep, that that makes sense. Now uh you you have a unique perspective because you're boots on the ground, uh formulating products on a daily, weekly basis. At the same time, you're serving you know multiple different companies at once, being um being where you are right now. So how are you seeing the impact of GLP1's kind of influencing the game right now from your lens?

SPEAKER_00 17:01

Oh, that's interesting. Um, I I think I think a lot of companies are struggling to understand how to service those clients or those customers. And part of that is we are learning so much about the you know, sort of side effects of GLP1s as it's happening. And so, and it doesn't seem to be consistent from you know, consumer to consumer. Um, the the number one thing is I think it's made protein more important, which has put more pressure on the marketplace to develop protein-based products and to develop um, you know, sort of for that marketplace, in part because they are able, you know, it changes all your brain chemistry, it changes your appetite, it changes everything. And so they're not eating as much just in general. And so protein seems to be sort of the number one thing everyone's focusing on. Um, but also, you know, it it I think there's a lot of sort of ignoring of the other side of that, that it loses, you know, people on GLP1 seem to be losing everything, not just their, you know, body mass and their you know protein intake, but bone density is starting to show up as a big issue. So I think calcium is gonna start, you know, becoming prevalent. They're having issues with nausea and hydration. And so I think some of those things are gonna start to become important. And so um, I think we're still figuring it out, I guess is the right way to say that, where you know, everybody's trying because so many people have gone on to them for a lot of good reasons, and we want to be supportive as an industry to that customer base, but I'm not entirely sure everyone's figured out what that means yet.

SPEAKER_02 18:52

Yeah, yeah. Yeah, that's the that's the scoop that I've gotten from other uh formulators that I've spoken with. Do you think maybe the the GLP one trend from a consumer standpoint, do you think that's gonna be more of a quote unquote one-hit wonder type of situation where it's gonna be popular for a time, but it's gonna quickly fade and uh the market and demand's gonna return back to quote unquote normal? Or uh do you think this is something that might be here for the long run?

SPEAKER_00 19:20

Oh, I I'm inherently pessimistic as uh as a scientist around trends. Uh that's good to hear. Um, I I don't think it's gonna last. And I think some of that is due to some of the research coming out around the impacts of it. I think it's a it's a hot drug right now for people to take for weight loss and weight control and everything. And there's a lot of research and you know, going into it, being poured into it for all the things it can do. But I do think it'll shrink back down to like its intended or or original purposes of really helping those people really in need and not like, you know, hey, I want to lose 10 pounds before my wedding, or, you know, I'd like to, you know, get back to looking like I did in college. Or, you know, I think I think that piece of it'll start to fall away as as the side effects become more prominent. Um, and so I I do think it it'll always be there because I it does seem like there is inherently very valuable stuff, you know, effects to what GLP1s are doing for those people and those original intended uses. Um, and much like with every other, you know, fad supplement or pharmaceutical, I think that'll shrink back into sort of its box where you know the medical professionals will tell us in a few years the right way to use it and where it has value, and you know, it'll kind of go back to being that something else will pop up that we'll go chase.

SPEAKER_02 20:56

Indeed. Indeed. Now let's take a little bit of a pivot here from because you work with a lot of, if I'm not mistaken, founder CPG startups, correct? Um so why don't you walk me through then uh you know the process from innovation through product launching on the shelf? Like what when when you meet with someone for the first time, what are some things that they're coming into the conversation with from an expectation standpoint that you have to really educate them, like, hey, no, this is this is actually how uh this is actually what you should be expecting when um you know formulating a product from ideation through commercial commercialization. Does that make sense? I I think so.

SPEAKER_00 21:40

Yeah. I I think um, you know, what what do founders expect the process to look like when they come in versus what it really looks like?

SPEAKER_02 21:51

Yeah, yeah.

SPEAKER_00 21:52

Yeah. Um so I think the number one thing is timeline. Um well, timeline cost and difficulty. Would be like sort of that triangulation point. You know, I I I like to tell founders that just about anything is feasible if you're willing to pay for it. Um, you know, anybody, you know, a lot of us will do a lot of things if we could clear our calendars completely, if you could, you know, ship ingredients overnight from the East Coast to the West Coast, or you know, bump someone from a production calendar, or so so virtually everything is feasible if you're willing to pay for it. Um, that being said, you don't want to overpay for anything because it, you know, you could pay for it, but it might cost you way more than you had baked in. And so I really talked to them about timelines first. And, you know, I think a lot of people come in thinking that this is going to go really quick, right? It's beverage. How hard can it be? All you're doing is putting some things in a glass and you know, mixing it up. And you know, all the production facility is, you know, blending it in a tank and putting it into some cans. And it's like, well, actually, it's incredibly complicated. Um, and so we we usually end up having a fairly lengthy discussion around timeline and what it, you know, what the process really looks like. And, you know, from bringing me an idea to product being on a truck heading to a retailer can be months. And you know, not like three months or four months, but like six to ten months. Um, there's a reason why you know large CPG companies take so long to launch product. Some of that is their own internal processes, slow them down, and you know, they've got some other things that they do, but that that make that longer. But generally speaking, some things just can't be changed. The lead time on an ingredient is not like a thing you can really, you know, speed up. Um, it just kind of is what it is. You have to get on someone's production calendar for a flavor that takes a you know a few weeks just to get them to put it into their system and get it blended and packaged to go to your manufacturer. Then it's got to go on a truck, it's got to go across, you know, several states to get to your manufacturing facility. They have to check it in and make sure that it meets specification on the C of A so that they can receive it. Hopefully, everything goes okay. Um, and then they've got to bring all those materials in. They've got to make sure they've got them all, they've got to get it on the production calendar, right? So they're there are just certain things that take time that you can't, you know, kind of change. Um, and so we we have to talk quite a bit about what that looks like. Um, you know, from a formulation perspective, it's revision cycles and it's shipping times of getting samples from you know my lab to your house or your office for you to set up a tasting and get taste tasting feedback to me so that I can then do another round for you to make sure that I address the things you did or didn't like. Um, and that takes time. And you know, everything has a baked in kind of required time frame that you just can't kind of get outside of. And then, you know, so you have to sort of work within those boundaries. And then inevitably, something always goes wrong. Right. It it just is, you know, something a big storm runs through Tennessee and FedEx's, you know, main distribution hub is on a ground stop for two days because you know, tornadoes are rolling through or whatever, and and um your LTL uh shows up to pick up your you know pallets for going to your distribution center and your manufacturing facility has misplaced a pallet somewhere in their gigantic warehouse. And you know, somebody drove a forklift through the side of the pallet, and now you've got you know eight cases of damaged product. Like stuff always goes wrong. And so, you know, we talk a lot about systems and frameworks, you know, to to make sure you can mitigate those problems as they pop up.

SPEAKER_02 26:05

Nice. Yeah, yeah. No, there's a lot of complexity that uh that is within that process for sure. From a from a formulation standpoint, like a flavor chemistry and and you know, beverage product development standpoint, what are some of the uh uh most common technical roadblocks that you have to walk companies through and help them solve for a really successful product launch?

SPEAKER_00 26:32

Yeah, I mean, I uh primarily processing. Um why why are certain processes implemented? Um, because obviously we're trying to make a product that tastes really good, that has a certain function and or purpose, you know, value proposition to a customer base. And so the process of making that safe for consumption can sometimes conflict with the idea of making it taste really good. So we talked a lot, you know, I mentioned a lot about AI and pH or citric acid as an ingredient and helping them understand why that is important. Um, you know, we have to make things safe for consumers, and in order to do that, the process has to be the certain way. And there's not, you know, there's a few different processing processing techniques you can implement, but fundamentally it has to be processed in a certain way, depending on the type of beverage. And that can often conflict with the like outcomes for taste and flavor enjoyment. Um, you know, certain flavor types want to be in, you know, relatively neutral or slightly below neutral pH conditions. And we're making a product that has to be a high acid food, a very low pH. And so that can conflict. And so they'll they'll say it comes off very, very sour. And it's like, well, yeah, that's because this particular type of flavor doesn't play well in a pH of 3.2 or 3.6 or whatever that might be. And so that tends to be a challenging one. And then the other one is taste and visual aspects of like functional ingredients that are not water soluble. So, you know, you go take a root powder or uh uh, you know, bark powder or something like that, and they want to put it in to water, and it's like, well, that contains a lot of cellulose or a lot of insoluble material, and so it's always gonna look cloudy or it's gonna have settling, or it's gonna be this, or it's gonna be that. And so that tends to be another one of talking them through sort of the core chemistry of water solubility and stability of a product.

SPEAKER_02 28:36

Gotcha. Okay, that's awesome. That's awesome. And you mentioned um, you know, there's always gonna be things, there's always gonna be obstacles that come up, there's always gonna be the unexpected that comes up. Nothing ever goes 100% according to plan. So how how do you, you know, to have a successful product launch, um, how do you prepare for those unexpected obstacles and kind of make sure that you're uh because I'm I'm assuming you're not going to predict when it's gonna come or where it's gonna come from. Um, but how do you kind of be be prepared to where that's not gonna alter the the the path of product launch and timelines and everything?

SPEAKER_00 29:19

Yeah, that's a great question. I think um the number one thing is is having the right systems and people, right? You know, having experts in your corner that have been there before, done that before, understand what could go wrong, how it could go wrong, and how to solve it. And then, you know, those people in particular, you know, whether it be someone like myself on the RD side, an operations person on you know, the ops and food safety side, there are things that are going to happen that some of us have never seen before. You know, there's always something new that happens every once in a while. And and but because we've been there before, we know how to solve those things. We know how to you know implement problem solving techniques, root cause analysis, you know, things like that to say, okay, it's happened. How do we fix it? And then how do we prevent it again? How do we have prevent it from happening again? And and those are system and process-y things of like making sure you implement the right documents control, the right supply chain materials. I talked to founders about something that they never think about. When you order ingredients, you need a certain amount of shelf life left on the ingredient. Because an ingredient supplier will sell you something that is still, you know, within their expiration date, but has like a month left. Because you didn't put in the contract that you need at least six months left on before the expiration date. The reason for that isn't necessarily isn't because you know you're not intending to use it right away, but it's because you're not gonna you're unlikely to use a hundred percent of the material you just bought for that production run. And so you need to have enough time left on the expiration date to use it again. And so, you know, there's all these like little details that you know, founders maybe don't think about that experts in the field have been doing for years and have experience managing and understanding that can keep you from making too many, you know, sort of mistakes that we've seen before. And then on the flip side, implementing those processes to help prevent or mitigate the risk of a problem occurring. And when one inevitably does happen, you have people that are there that can help solve it for you and bring things back to a stasis point, a happy stasis where you know you can fix a problem from manufacturing or shipping or you know, an ingredient supplier issue or whatever that looks like, and get you back on track and then implement something, you know, implement a framework to prevent that same thing from occurring again.

SPEAKER_02 32:02

Yeah. Okay. I love that. I love that. Now you're kind of you've been on both sides of the aisle from a consultant and a, you know, working for a company. I know it's very common for founders and startups to leverage consultants and as much as possible, or the RD teams at Commands. And then, you know, eventually there usually gets to a spot where they transition RD in-house. So if you could speak to, I know you may be a little biased, and that's totally okay. You can kind of really speak your mind with this. Um, but uh, you know, if there's a founder listening or a startup, um how just speak speak to that uh as a whole, just a consultant, in-house RD. Uh if you could just speak to that, I'd love to hear that.

SPEAKER_00 32:50

Yeah, that that's great. Um, so I I started a short series newsletter on LinkedIn uh called Unformulated to talk to that specifically to this question. Um there's a lot more detail than I'll go in into on this conversation there if if people are interested in reading some of my thoughts. Um I I've worked at a flip multiple flavor suppliers, right? So I used to be a flavor, you know, full-time flavor chemist manufacturing and selling flavors. So I've been in that that world. I've worked for CPG companies, startups in particular, as the director of research and development, you know, who would buy flavors or buy ingredients and you know, work with Coman's to manufacture a product. And then I obviously now I'm a consultant doing innovation and formulation work. Um, I think it all boils down to incentives. And I think it boils down to what your outcomes are. Like what are the desired outcomes as a brand, what are your desired outcomes, and how hard is it to get there? And every model out there has its advantages and disadvantages, right? And speaking to mine specifically, the advantages are you have a partner that you're paying directly that is has expertise in the field that you're looking for, whether it be me, whether you're doing gummies and it's somebody that's a gummies expert, whether it be, you know, um extruded snacks, whether it be frozen food, right? They're experts in all of those fields that are consultants that have been doing that specific work for a very long time. I recommend doing some background on that person to make sure that they are legitimately the expert in, say, beverage or frozen food or whatever. Um, because if you come to me and you say, do a frozen food for me, I'm I'm not doing that. Like that you don't want to hire me for that. That that's not my area. Um, I know people that it is. The the point being that like we're an ex, we're experts in this area, we're in your corner. You're paying us literally to be in your corner 100%. It comes with a cost, it's expensive. Hiring in-house RD, though, is much more expensive and time consuming. And so there is probably a point to do that transition. But that point is when you have enough money and capital to afford to rent a space, buy the equipment, hire a full team because you're not hiring one person. You need somebody that has expertise like mine to run the whole organization. You need people that work under them to do the lab work, right? You you need a an infrastructure that is very expensive and time consuming to stand up. And so that's where the consultant can get you there much faster and can help, you know, shortcut a whole lot of things, but still gives you the expertise that you need to make a successful product. The other, now the other side of that equation, the the people that, you know, the flavor companies, the commands, you know, the develop the high throughput development houses, they have models built around selling you something other than the expertise in the formula. And that's where I say be careful. They work and they can be very valuable to you as a founder and his brand because they cost less than someone like myself. Yep. However, you need to be very aware of the incentives of where it is. If it's a co-man's RD, their value is in you manufacturing product with them. So there are pitfalls to that. One could be the contract. Do they own your formula? Do you have rights to the IP? Uh, the other one can be supplies and materials. Are they going to leverage the full available catalog to making your product, or are they going to use simply what they already buy? Because being having been on the other side of the equation doing manufacturing, you want to limit the number of materials you're working with, right? You want to leverage what you have. You want to keep your supply chain narrow so that you can increase your revenue and your margin by you know kind of streamlining everything into a similar bucket. So it makes your manufacturing easy, it streamlines everything, right? Incentives. If you go to the high throughput development company, their whole model is built in on churning you in and turning you out as quickly as they can with as low drag as possible. So you might talk to an expert, but the person running your product might be a junior member. And they're gonna do things, they're gonna do things the way they always kind of done things, and they're gonna try to fit your formula to a framework they know already works to try and limit the amount of hours they have to put in. Because, you know, hours mean equal resources and resources equal money. The flavor company wants to sell you flavors and they want to sell you a lot of flavors. And so they're gonna build your formula as quickly as they can around the flavors they sell and manufacture. So, so it's not that anyone is better or worse than another. It just depends on what you're trying to accomplish and what your goals are and what the difficulty of your product might be. If you're making something that's relatively similar to a lot of other products that are out there, a flavor company may be perfect for you because they're not going to charge you or they're gonna charge you a very small amount of money because they're gonna make their money on selling you the flavor. And that might work. Same with going with a co-man for product development. If it's similar to a lot of stuff they already produce, it might work really, really well. They have expertise and experience running that at scale. They know how to do it, and so it could work really well, knowing that you might be pulling from the same block of materials that five or six other brands are also working with. But maybe your entire brand is built around the brand and the marketing and you know your Instagram following, right? And that might work really well for you. And that could be a quick and easy and inexpensive way to get into the marketplace. And so it all boils down to what you're trying to accomplish and what the incentives of the the product are.

SPEAKER_02 38:53

Yeah, I love that. Love that. And that's kind of a decent segue into your company, Noda Bene Flavors, and uh your your consultancy and everything. And it's growing rapidly. You and I talked kind of uh off camera here, just how how much value you're adding in the marketplace right now and the amount of clients and product launches and all the pieces there. So if you could just give a little bit of an overview of your consultancy and um really some of the one, you know, your specialization. You've already pretty much hit on your specialization, but if you could really speak towards uh the the problems you help people solve and where your your greatest value add is, uh I'm sure our our audience would love to hear that.

SPEAKER_00 39:40

Of course. Um yeah, so so number one, you know, it's it's really billed as an innovation consultancy. And so we we create formulas for founders, right? And and that's the number one sort of centralized piece of the puzzle, similar to a lot of other formulation outfits. We help you take an idea and we turn it into a formula that's scalable. I think where the the value is is that we really see ourselves as a partner for companies that are trying to get off the ground, right? Trying to launch maybe they're brand new, they've got an idea, they they don't really know how to turn it into a formulated product and scale it. Uh, maybe, maybe you're already a company that's out there and you're not happy with the original formula for whatever reason. Um, we help you reformulate and and put the sort of the framework in place that helps you communicate with your manufacturer, help them understand, help your manufacturer understand how the product was formulated so that they can then scale it for you. Um, you know, we we do long-term servicing as well around uh being around to help with manufacturing, to be able to help with problem solving, uh root cause analysis if something should go wrong. Um it's really more built around sort of that full, you know, RD function. Um, and I think that that's a big reason why sort of the statement on the website is fractional RD is the goal is really to be company's partner in this, not 100% as an internal resource, but someone that can help you more like an internal resource. Because, like we talked about in multiple different facets here over the course of the conversation, something will inevitably go wrong. And even though you might have a manufacturing partner, maybe you also have an operations partner, there are things that pop up that those people, you know, don't necessarily have the expertise to help you answer. And we can help you with that piece of it. And so um I think the key sort of value proposition to Nota Bene is yes, we can create formulas. We're very good at that for beverage in particular, um, really good at clean label, really great at like, you know, new health and function-based beverages. But the the the key value proposition is what happens after that. And and how do you how do you take that and and build those partnerships and build those frameworks to making sure that for your formula runs again and again and again the right way? And when things start to go wrong, how do you solve for them? Um, you know, because because things change, things shift, supply chain gets wonky, you know, a supplier you know stops wanting to sell you an ingredient or jacks up their MLQs or changes the price on you or whatever that may be.

SPEAKER_02 42:34

Yeah, awesome. Yeah, I love that for sure. And as we kind of um transition to the end here, we we have a tradition here in the podcast. Uh the tradition is, and it's funny, you and I didn't have a prep conversation at all before this. So I don't even know if you you uh know where I'm going with this, but um the the previous guest always asks a question for the next guest, and then obviously you would have a mystery question for the the guest that follows after that. So uh you don't have any context to this question um or anything, but uh the mystery question from our previous guest is uh what is the best place you ever ate at? What country was it in? What's obviously restaurant uh was it? If it is a restaurant, if it's not, that's totally okay. And paint the picture of the specifics from a formulator standpoint of like the ingredients, the flavor, the what just what what made it the best quote unquote food slash beverage that that you consumed?

SPEAKER_00 43:39

Oh, that's a that's a fantastic question. Uh no, and just a side note, my my philosophy on these is is very little prep. Like, yeah, let let things come naturally on these these sorts of discussions because uh you get a lot more value that way. This is a great question. I think um I'm gonna talk a little bit about the Psychology and so, you know, sort of the psychology and social aspect of food with this one. I think. Um it's not necessarily the best or the greatest meal or meals that that I've ever had, but I think um there was a restaurant, it's no longer there, um, but it's it's in my hometown in Cincinnati. It was called Ennoteco Amelia. Uh and if you know anything about Cincinnati, there's a ton of little neighborhoods that have these fantastic, like local restaurants all over the city. And um there was one in the town next to the one that my wife and I were living in at the time uh called Enoteco Amelia. And we had sort of just gotten out in our career, we careers, we were we were just starting to make it. We finally had like just a little bit of money to go out. And so we we found this place um searching online. It had got great reviews. It was more expensive than we had probably been able to, you know, afford at the time. But we're like, we're gonna go. It's you know, it was her birthday or my birthday or some you know, special sort of night out. And sort of like, we're just gonna go, we're gonna get like appetizers and a bottle of wine, and then we'll go home and make dinner. And like, it was like that's what we could stomach affording at the time. And um, it was just incredible. Um, the food was amazing. We got the charcuterie board, we got some appetizers, and then we ended up getting a pasta dish to share. And so um, you know, I think what was amazing was, you know, from a formulator's perspective, is you know, we talk a lot about ingredients and melding of ingredients together. And obviously they did an amazing job. But something we don't talk a lot about, especially when you start talking about sensory testing and like product measuring of product, is setting and psychology. And one of the things that I talk to a lot of founders about is when you're measuring your beverages in the marketplace, you really can't separate uh setting and psychology from the experiences someone has had. And so, you know, ingredients, the ingredients they used were amazing. They're all fresh. They did interesting things blending different ingredients together that you wouldn't have necessarily had considered blending together. And so they had, you know, pasta dishes that used, you know, that were very traditional with one, you know, one ingredient that was a slight twist. Maybe they used a specific truffle or they used uh a pepper in a unique way that made it very delicious. But the setting was amazing because they had the right ambiance and we sat at the bar. We sat at the bar and they had this fancy old uh espresso machine that looked like it came out of the 1940s. And so you could, you know, when they made an espresso for someone for dessert, you'd you'd hear it, right? And and you could sort of smell the the roast of the coffee coming up while you're eating. And, you know, it it you can't separate an experience from like the food or the beverage from the ambiance and the experience in the environment someone's having it. And so if you take that a step further as a formulator, as a product developer, it's it's not just like where did they consume it and who did they consume it with, it's how did it show up at their door? What was the experience of ordering it online or buying it in the retail? What's the package look like? Right. And so all of those things come together of how they interpret your product when they drink it. And so you can ruin your product score or your ability to get someone to retaste it by failing somewhere else too, right? Like we talk a lot about and obviously there's a lot of branding people that'll tell you like the brand is the most important part. And there's a lot of formulators that say, well, repre-purchase is all about what's inside the can, right? And that's true, right? Like if your product tastes like you know garbage, they're never gonna rebuy it. But they're also not necessarily gonna rebuy it if like it shows up at their door and you've got two cans that aren't filled properly, yeah, or are not carbonated properly, or there's sediment in the bottom, or right, and so it the whole thing has to work together. It can't just be you have to be careful about focusing too much on one aspect. Uh the whole thing has to work because, like at Anoteca, it was everything. Everything made that it I don't know if that pasta was really that good or not. I can't eat there anymore, they're not in business anymore. I don't live in Cincinnati anymore either, but like they're not there, so I I can't go validate it. But in my mind, everything that went into that meal made it amazing.

SPEAKER_02 48:52

That's amazing. I love that response for sure. It triggered a thought, and maybe there's another formulator I was talking to. Um, she mentioned about there's a there's a trend in from a consumer standpoint where uh consumers now are um they they first connect with a founder story, um, and then that's what gets them to buy a product. And when they buy that product, they're uh almost experiencing that they have an attachment to that founder uh because of the founder story, because they connect so well with the founder story. So obviously there's a lot of variables that go into that, but I think that that you sharing that made me think of that statement she told me one time. Um, which is pretty cool there. So appreciate you sharing that. That's that's amazing. What uh what's a question you have for the next uh guest on the podcast?

SPEAKER_00 49:45

Oh, I I think to kind of keep the like I I have a few that I thought up to, but but the one in particular I I think is is very apt based on everything we've talked about and some of the disconnects. Um you know, what where's the biggest disconnect between the story a brand tells, puts out to everyone, you know, the marketing story, the brand on the website, and what really happens behind the scenes.

SPEAKER_02 50:14

Uh okay. Got it. We have our we have our next recording today, so actually in a couple hours. So I'm gonna I'm excited to ask that. That's amazing. Yeah. Well, Michael, I really appreciate you taking the time here. This is incredible, file, incredibly valuable conversation. Uh I know you are very active on LinkedIn and you have a honestly, you have some incredibly valuable content that you go above and beyond from your content perspective online. That honestly, from my standpoint, it's a huge value add as I continue to learn this industry, I'm sure with two other people as well. So, uh, what's the best way people can stay connected with you moving forward?

SPEAKER_00 50:54

Yeah, and and thank you for the compliment. Um, yeah. So obviously you can find me on LinkedIn. Uh, I also have a Substack newsletter that you can subscribe to that takes what's on LinkedIn and goes 10 steps further. Uh, if you want to learn about flavor chemistry and beverage development and you know the nuts and bolts of what makes our food and beverage such a joy to experience. Um, you can also find me at my website, uh, notabenaflavors.com. Um, and there's a contact form on there as well uh if you have questions or anything. Um, so LinkedIn, Substack, website.

SPEAKER_02 51:29

Boom. Love it, love it. Well, also, Michael, again, appreciate you taking the time. This is an amazing conversation and looking forward to staying in touch.

SPEAKER_00 51:38

Of course. Thank you for having me, Nathan. And uh, let's do it again sometime.

SPEAKER_02 51:42

Amen to that. And that concludes another episode of the CPG Level Up Podcast. If anything that we shared today resonates with you and adds value, would love to connect. You can reach us at uh our contacts page on our website, progressusolutions.com. You can follow us on LinkedIn, and you can also connect with me and message me personally, uh Nathan Schmidt on LinkedIn. I'm pretty active there and would be open to hearing some suggestions, feedback, etc., so we can help improve the content moving forward and looking forward to hearing from you. Have a great day.