Danielle Gould of Food+Tech Connect interviews Exo: the first company to bring crickets into the American diet

Launched in 2013 by two Brown University roommates, Exo was the first company to bring crickets into the American diet.

It’s no small feat to introduce an unusual new ingredient like crickets, yet Exo found a market of passionate enthusiasts and attracted star investors like Tim Ferris and Nas.

I asked Exo co-founder Gabi Lewis how they developed their product and found product/market fit.

Danielle Gould: What was the initial product development process like for Exo?

Gabi Lewis: The first cricket bar, made in our kitchen while Greg (Greg Sewitz, Exo co-founder) and I were in our final year at Brown University, was just a simple recipe I had been using myself for homemade protein bars — dates, nut butter, cacao, honey — except now with some crickets added to them.

As soon as it became clear that this might be a real business, we knew:  in order to convince people to eat crickets we had to create something that tasted better than other bars on the market. We joined forces with Kyle Connaughton, an incredible chef who had run the kitchens at some of the world's best restaurants. He improved my original recipe immensely and created several more.

DG: How did you validate that there was a market for your product?

GL: At first it was just through talking to people. We took the very first batch of bars we made at home to our local CrossFit gym to get feedback, and everyone was blown away. People couldn't believe they were eating crickets, and those crickets tasted great, they were healthy! The next day we decided to test our product on a more conservative audience and went to our local farmer's market, but the reaction was just as positive.

DG: At what point did you know that you had found product/market fit?

GL: We did a Kickstarter campaign right after graduating from college and starting to work on the company full-time. We flew past our initial goal in the first couple days, raising $55k in a month, and that was the initial proof of concept we then leaned on to raise capital and scale the business.

DG: Who are Exo’s customers? How do you get them over the yuck factor?

GL: At first we focused on the Paleo and CrossFit markets, but now it's pretty much anyone who is interested in a healthy or sustainable snack. Our customers are incredibly varied — from athletes who use our bars as pre-workout fuel, to kids who enjoy them as an afternoon snack, or former vegans looking for an ethical source of protein.

As for the yuck factor, we've found most people are willing to at least try a cricket bar, so driving that first taste is the key. In person, we'll do that through demos, and online we'll do it through selling low-priced sampler packs with free shipping and removing as much of the friction to trial as possible.

DG: What is your channel strategy and why?

GL: We focus primarily on direct-to-consumer through our website. This strategy has allowed us to build a community of passionate early adopters who are excited about insect protein, as opposed to our product getting lost in a sea of similar-looking protein bars in a retail environment.

DG: How do you test new product ideas?

GL: We'll do small limited edition production runs of new flavour ideas and launch them to our monthly subscribers online. If the reaction is positive, we'll then test with our broader group of online consumers, and if it passes that second hurdle, we'll keep it as part of our standard selection as well as introduce it to our retail partners.

DG: How did you establish your supply chain?

GL: When we first started, the supply chain was virtually non-existent, so we worked very closely with farmers to set up all the parameters around farming and processing crickets for human nutrition. It was a massive amount of work but it continues to pay dividends in how close we are with our partners along the supply chain, and how well we understand that side of the business.

DG: What was the process of finding a co-packer like? What enabled you to secure a co-packer?

GL: When we first started we had very little leverage — not much financial backing, barely enough demand to meet most co-packer minimums, and the added complication that one of our ingredients was crickets which was a very controversial thing at the time. So we had to talk to lots of different manufacturers before we eventually found a partner that was flexible. He believed in our long-term vision and was willing to take a bet on us.

DG: If you could start over, what would you do differently?

GL: I'd do less. It's tempting to try to do everything differently — cutting-edge ingredients, crazy new flavours, vertical integration, innovative sales strategies— but there is a danger in innovating too much, and either getting too far ahead of the consumer, or simply getting distracted. Doing fewer things but better is the key.

DG: Why did you decide to sell your business to Aspire?

GL: We were both in this industry at the very beginning, and we've known Aspire for years. While we've spent our time building one of the most recognisable brands in the space, they've been creating the most sophisticated supply chain to complement it. By joining forces, we're able to vertically integrate and take insect protein to the next level.

DG: What will it take to make insects mainstream?

GL: It'll take time and more players in the market. We are often asked whether we are worried about competition, but from our perspective, the more companies making high-quality products with insect protein will be out there, the more accepted it will become and the larger the entire category will get. Right now it is all about education.

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