Making healthy food accessible to everyone with Nick Green from Thrive

Food deserts are a growing problem in America where millions of Americans do Not have access to healthy food that's In addition to the fact that many live Far away from grocery stores and those Who do live near one have to do with the Now rising cost of food one study found That the average household grocery cost Per month is $475 with that number likely to go up It's clear the system needs a new Model you're listening to found Tech Crunch's podcast that brings you the Stories behind the startups and today We're talking with Nick green the Co-founder and CEO of Thrive Market a Membership based online grocery store That focuses on natural and organic food And household products I'm Becca scac And here nerding out about grocery Logistics with me is my fabulous co-host Dominic madori Davis and of course Before we get into our conversation with Nick we have our two truths in a lie and At the end we'll tell you which one Isn't true so listen closely to see what Is the LIE is it that one of th's Co-founders grew up on a commune where He learned the importance of organic Foods that some of Thrive Market's First Investors were influencers and content Creators or is the lie that Nick Realized a year into building the Company that they need to switch all

Their packaging into being sustainable Ooh those all sound like great options So listeners you will just have to keep Listening to find out and here was our Conversation with Nick hey Nick how's it going it's going Great nice to meet you nice to meet you As well I'm going to say I pre for this Conversation not in the best way because I am currently hungry and I have kind of Have a feeling I'm going to be more Hungry as we keep talking that's Actually not a bad state of mind if We're going to talk about food you might As well be having it on your mind to Begin with that is true maybe that's Right but why don't we start by having You tell our listeners a little bit About Thrive market and maybe a little Bit about why we are going to be talking About food sure so Thrive Market is a Membership based e-commerce platform That makes healthy and sustainable Living easy affordable and accessible Anyone so our paid members pay $60 a Year for a membership they get access to A curated assortment of kind of the best Natural organic sustainable regenerative You name it better for you products it's Kind of stuff that you'd find at a hell Food retailer like Whole Foods or even Kind of a mom and pop a health could Store a lot of things you wouldn't find In a conventional grocery store and then

They're all discounted prices through That membership model every paid Membership then sponsors a free Membership for a low-income family a First responder a military veteran a Teacher or a student and we're really Trying to build a community that can Create ultimately a movement so that It's not just people in high income Areas and urban areas and places that Have a health food stored down the Corner or on the corner to eat healthy But really anyone any place any Background can get access to better free Products at an affordable price that's Kind of Thrive at a high level it's Mostly food so like call it 60 to 70% of The assortment is food stuff kind of all Of your pantry Stables we also have a Frozen assortment of meat and seafood we Even sell you know organic wine and Regenerative wine but there's a lot of Non-f food products as well so I think More and more people are not only Looking at how do I put healthier things In my body but also on my body and in my Home and these kinds of products also Have a really significant effect through Sourcing and supply chain and Ingredients on the environment so for Conscious consumers that want to kind of Vote with their dollars and make good Decisions for their family for their Health and also for the planet we're

Ultimately trying to build a One-Stop Shop where you can get all your stuff on Thrive and with the movement toward Eating better and using these cleaner Products that we've been kind of seeing For quite a while now it is surprising To think that a lot of this was fully Taking place if you happen to live near A store that sold those products as Opposed to be able to find a lot of them Online so I'm curious what made you Decide to get into this space to begin With how did you discover that this was A problem well I lived that problem Firsthand growing up so I grew up in Minneapolis Minnesota or outside Minneapolis Minnesota and being middle Class in the midwest in the and 90s There was a lot of really unhealthy food Processed foods were kind of the name of The game and there wasn't a lot of Awareness of what the results in human Health were from those Foods my mom Happened to be one of those kind of Interesting I was say like vigil anti Warriors if you will on the health front Back when no one was really thinking About this stuff and it really came from Her own experience with her family um so She grew up in a large Mexican-American Family very working class and her Siblings have diabetes many people had Issues with obesity and weight and then Ultimately there was issues with cancer

And all sorts of other chronic diseases As people got older and so she was Really determined to make a change in Our lifestyle and happened to be that Kind of like independent researcher do- It herself person that went out at a Time when you know there wasn't the Internet right and said I'm going to cut Out sugar for my kids diet I'm going to Go organic I'm going to reduce processed Foods and I saw how hard she had to work To make that happen you know there were Not there wasn't Whole Foods on the Corner if there had been we wouldn't Have been able for the price premiums And so I lived that you know fast Forward 20 some years I had sold an Education company and was thinking about What I wanted to do next and met my Co-founder gar who had kind of the most Different possible childhood you can Imagine he actually grew up on a Communal Farm in ohigh where they were Growing their own food and sourcing Wholesale organic products from all over The country and he had this vision for Taking that to the masses which was you Know basically taking it to places like Where I grew up and when I first met him What actually shocked me was to realize And I had lived in Boston for seven Years before that and then moved to LA You know that in most of the country There still was the same kind of

Situation more or less that my mom was Dealing with where prices were really High there wasn't access if you didn't Have a brick and mortar store that was Nearby and a lot of people didn't know Where to start so basically he pitched Me initially on investing on an idea That was to build Groupon for healthy Food and by the end of that first Meeting I was pitching him on building Something together that could achieve That mission and the mission's been the Same since day one you know make healthy And sustainable living easy affordable Accessible to everyone and it's been Very personal and I think that Northstar For us has enabled us to you know scale And stay at it now for nearly a decade Because that was back in 2014 that we Started and you just mentioned a little Bit that your co-founder came to you With a pitch of how to do this which Isn't exactly what it ended up becoming Was where you guys are now your first Idea walk me through what it was like Having this idea having this Mission and Then sort of landing on the strategy That you guys ended up going with for Thrive yeah it's a really question I Mean the short answer is no the business Has evolved and changed and grown past Kind of our wildest dreams and I think That that flexibility to change and Pivot and add on and also push through

When things got really tough you know All of that was made possible by that Mission you know I think a lot of Business or a lot of people tend to Think that you know a mission based Business that that can kind of be a Handicap but in our case it was Absolutely not only you know a asset it Was kind of the asset that gave us that Through line on everything we did and Honestly it's the reason why like we Were able to Pivot very quickly off of That group on type model and that's Where we got into doing membership we Started out with just thirdparty Brands And then we added our own brand we Started out with just non- perishable Products and just in the food category Then we layered on other categories and Ultimately got into Frozen and we just Use that mission as a filter for Everything we do if it aligns to the Mission if it builds on that Foundation Of making healthy and sustainable living Accessible then you know we kind of Stack rank impact and can make decisions That way particularly as the business Has grown you know we're now nearly a Thousand employees you know we have a Million squet of warehouse space we're Carrying tens of millions of dollars of Inventory you know the stakes of Decisions that you make from a business Standpoint go up and become more and

More complex I think having that like Simple litmus test of does this feed the Mission has actually enabled us to adapt So you know when we started basically All we had was group on for healthy food To achieve this Mission the Groupon part Obviously dropped out but you know that Mission has stayed the same and Everything we built since then has been Around that and I know thinking about The fact that you guys are an e-commerce Platform I know a lot of people weren't Really used to say buying groceries or Buying kind of products like that online Prior to co and knowing you guys started Quite a bit before that personally Dom And I've talked about this on the show Before I still have never ordered Groceries online which I know I in the Minority who have done that but I am Curious what was it like we'll change That today what was it like getting People to shop in this way because Especially with you guys were getting Started of course a lot of us were Buying a ton of stuff on the internet by That point already but groceries wasn't Really one of them and so what was it Like kind of getting people to both sign On to buying that online but also the Membership piece because I know I mean I'm a Costco member so I get the Membership for buying goods but it's not As common obviously in this kind of a

Category yeah so two separate questions But both really important so yes like There's kind of a paradigm shift Required that to your point was Accelerated during the pandemic where Most people prior to the pandemic had Not ever shopped for groceries in an E-commerce setting obviously in 2014 That was true for you know call it 98 99% of American families you know the Kind of tragedy of that is that if you Don't have the density of sort of high Income you aren't going to end up with High-end retail locations that carry These like better for you natural Organic products so if you look at Whole Food's footprint today or you look at The footprint of any natur organic chain Or any independent retailers they are in Dense urban areas in ZIP codes with high Income and they're catering to a very Sort of curated and so I would say like Elevated consumer and right now about 50% of Americans This is today in 2024 Still don't live within driving distance Of a health food retailer in 2014 the Number was even more dramatic so for us We said look there isn't really a Business model because there is the Population density in some of these Areas or there's not the wealth density To go and open up a brick and mortar Location and if we wanted to start out And be brick and mortar that would take

Years to do anyway right it took 20 plus Years for Whole Foods to roll out its Footprint like e-commerce was the Obvious solution to that and the obvious Challenge was how do we convince people To buy these things online and the way That we handled that was by starting With the areas of the catalog and really Sticking to the area the catalog that Has the least barriers to change so a Lot of people want to like touch the Avocado and see if it's right they want To look at the banana like for those Fresh Foods and refrigerated I think It's going to be a much slower process But the core of our assortment is Actually products that you know go in Your pantry they go in your medicine Cabinet and they come in a box or in a Package and they don't require that so Because it's a more standardized item And because it's not perishable it Actually works really well for E-commerce and that's where we've Focused but to be honest like it was Definitely a process to First even Before convincing consumers we had to Convince investors and like we got Rejected by every Institutional Investor We talked to we ended up having to raise Money in like5 to $25,000 chunks from Health and wellness influencers and Thought leaders and people that aligned With the mission because there was no

Major investor that would give us money Back at the beginning what was really Cool though is that right away when we Launched we saw the latent demand of People that to my point earlier didn't Necessarily live near Whole Foods wanted To access the life style and we're Actually really willing to do it online If that was the only way to make it Happen and then to your question about The membership very similar so like Geography is one barrier to getting Healthy if you don't have a brick-and Mor retailer in your area you got to go With e-commerce that's why we went with E-commerce but another barrier is his Price and so if the average premium for Natural organic products is anywhere From 20 to 40% we had to figure out a Model where we could essentially sell The products at wholesale and that's Where Costco became the template right Costco is a wholesale Buying Club we Said can we do this for these higher Quality products and the membership Where people you know pay up front they Get access then to like basically we Sell the products at a very low margin And then what was interesting there is That the membership also enabled us Power an even more kind of ambitious Part of our mission which was reaching People that not only can't afford the Products but also wouldn't be able to

Afford the membership so that's where we Have every paid membership sponsoring a Free membership for a family in need you Know we have hundreds of thousands of Those members today and it's actually Been good for our business like they're Spending tens of millions of dollars on Thrivemarket.com each year so it's good For business it's also good for the Mission and I think one of the ways We've built this community where people Feel like they're coming together and Not only supporting their healthy Lifestyle but also those of other people And what about Thrive Market made those Early investors kind of go on pause what About Thrive market and I'm assuming Like the grocery sector in general I Mean part of it was very rational in That there had been like back in the web Van days you know a number of would be E-commerce players and kind of the first Do bubble in the grocery space and Absolutely none of them succeeded even Amazon had tried to make foray into Grocery and not been very successful With it so I think part of it was very Rational I think part of it honestly was Just a bias and not in like a sort of Negative or pernicious way but just a Reality of like most of the investors we Were talking to lived in LA and New York And San Francisco most of them were you Know men who didn't do their own grocery

Shopping most of them are themselves High income like the question that we Got most often when we went to these Investors was you know how are you going To compete with Whole Foods and our Answer was we're not like Whole Foods is Cater to this like tiny rarified air of Consumers who can afford the price Premiums and happen to live in driving Distance the Whole Foods we're going After all the people that don't and Can't and it turns out that's actually a Much bigger market so we think it's a Bigger business opportunity but yeah I Think they didn't see it what was Interesting is how quickly the tide Turned when we got out and got traction And a lot of the same VCS that you know Wouldn't take a second meeting with us a Few months earlier we're now coming back And saying hey we get it we see it now We want to come in and you know to their Credit like they were quick to you know Correct their their bias and say we were Wrong you proved this out let's do it That's so interesting yeah because of Course they've probably never been to a Food desert like just being in LA and SF And all these things food deserts are Like a massive Problem by the way I Don't know why people don't like realize That it's yeah I mean it's the classic Like middle of the country is consider Flyover right like a lot of a lot of

These investors have I think one of the Other things that's quite interesting is It's not just the middle of the country Like even in LA or San Francisco or New York there are food deserts they're not It's I would call like a health food Desert where people are shopping like They're going to the convenience store To buy their food or if people are using Public transportation even if it's Within driving distance it may not be Within reasonable distance for them to Get to a healthy grocery store so yeah It is it's a major problem it was then It still is today and I actually think Back to the e-commerce Point like E-commerce can solve that you know one Of the recent efforts that we've really Focused on is for folks that are on EBT Using food stamps and there's you know Over 40 million Americans many of them Parents you know single parents with Kids who use EBT as their primary source Of funds for grocery shopping until Literally a month ago you could not use EBT on any Pure Play e-commerce Retailers website so we're the first Ones to be able to accept food stamps Online that's pure play e-commerce and That's a huge watershed moment for People that you know again tens of Millions of American families who use This as their form of of shopping budget The problem is huge the problem has been

Huge for a long time but it is is I I'm Really optimistic that we and others and Even like the USDA now making this shift You know we're going to start making Real inroads there I wanted to talk to You about the food stamps but before I Get there I wanted to learn a little bit More about the logistics of the early Days because how do you run a food Company like where do you store the food Like how are you handling like the Logistics really early on so it's Interesting that you asked that because That's probably another reason that all Those investors rejected us we didn't Have great answers to those questions Honestly like neither you know gar nor I Had experience in e-commerce our third Co-founder Sasha who is our CTO did and He had a business they had used to 3pl So he knew just enough to be dangerous And actually built out our initial Warehouse so it was pretty much fly by The seat of our pants in the early days Fortunately at that time you know it was A very curated assortment we had great Partnerships with the brands who really Helped us and we just got in there and Like rolled up our sleeves and as we Scaled because it happened so quickly we Are also able to kind of punch above our Weight and bring in really seasoned Folks so we like brought in a very Senior fulfillment person who had spent

Most of his career at Kroger within 6 Months of launching the business and That's been a a real theme throughout The history of Thrive is I think the Mission not only has it been this North Star for us to execute but it's also Been a real magnet for talent where People that frankly we have no business At any given stage hiring would come in Early because they believed what we were Doing and wanted to be part of it you Know we had the same thing our chief Merchandising officer joined us he' run You know a billion dollar division at Whole foods and came in literally Pre-launch to build out our assortment So the logistics you know I think we Didn't fully appreciate how complex and Challenging and frankly like difficult To get to scale these kinds of Businesses are because they are low Margin because they're very competitive Because they're Capital intensive but Again like the mission gave us the where There's a will there's a way and at Every turn whether it was a person Coming in whether it was us rolling up Our sleeves and digging in ourselves Like we were able to kind of figure it Out and it was a hum experience like Sometimes things took longer than they Should have but you know I look at back At it and here we are 9 years later we Have you know 1.5 million members we're

Doing hundreds of millions of dollars of Sales annually and you know we're Shipping hundreds of millions of Products in any given year out of a you Know fulfillment Network that has more Than a million square feet of warehouse Space and it employs 700 plus people so It's it's pretty incredible if you do Have that the motivation is strong Enough over the course of a little bit Of time you can really get there Listeners of the show have known or have Heard me talk about in the past but I'm Very interested in the grocery Logistics Space I read a whole book on it and I Just find the whole thing fascinating Because like you said it is those low Margins it's a lot of moving Parts it's Not really clear always exactly what the Right thing to do is off the bat so it Is interesting to hear kind of like how You guys have been able to grow into That side of the business but I do want To talk a little bit about I know Dom Had mentioned it about the process of Working to be able to accept food stamps Because especially if you guys are the First e-commerce retailer who can accept These like what was that process like And like was it difficult being able to Kind of get through I'm sure lots of Bureaucracy and things like that to be Able to kind of get that ability so Maybe if you want to talk a little bit

About like what that was like yeah I Mean it was really challenging and it Took a lot of time so we ran our first Or we first approached the USDA back in 2015 just saying hey it's kind of crazy That you can buy you know like orange Soda and chips at your corner store with Food stamps but you can't buy healthy Food online like that's not right They're like we agree but we don't know Online and you know we don't have any Plans to do it so way back in 2016 we Actually did a petition and went out to Not only our members but just like Broader kind of online aligned folks who Came through many of our influencers and Celebrities that got on board and we got More than 300,000 signatures in like six Weeks with this petition to basically Solicit the USDA to start accepting food Stamps online and that catalyzed a pilot Program that I think kicked off like a Year or two later and for a variety of Reasons that were kind of frustrating at The time like we weren't actually able To be part of that pilot and then it Wasn't until the pandemic that things Started to move a little bit again when You know all of a sudden to your point Earlier like the floodgates opened on Online and there's this whole question Of like is the future of grocery going To be entirely online and for how long Could that be the case and so I think

They had a very urgent forcing function At that point to do something and they Accelerated then I think it was 2021 That we finally they agreed to engage With a pure play e-commerce retailer at The time they were very concerned that If you didn't have a brick-and mortar Presence they wouldn't really know how To work with you and then you know it's Taken a couple of years since then to Just get things going so I would Contrast like that process with the Operational challenges which are hard But are ultimately in your control and If you have enough creativity and you Bring the right people to play you can Solve it this one was really tough just Cuz you know our hands were tied you Know no fault to the USDA I think they Got it and they wanted to make it happen But they're a huge organization it's a Program serving again 40 million plus Families they they're just moving a big Ship and they don't know what they don't Know so like for them one big concern Was fraud and it turns out it's actually Easier to control fraud I would argue Online there's a lot more that you can Do when you have just one point of Purchase and like we spend a lot already Building all those fraud prevention Mechanisms which work for any payment Method and now will work just as well For SNAP BB

But you know explaining that to an Organization that hasn't worked with Online retailers there was just a lot of Skepticism so to their credit they got There you know we feel like I wish it Would have got happened faster but now It's day one and all right the big Question now is let's look forward and How do we now make up for lost time ramp It out as aggressively and as quickly as We can and just get the word out there With a megaphone to families that this Is now an option yeah it is interesting To think about because while that Obviously is not fast if you kind of Started the conversation in 2016 Compared to some other government Initiatives that probably isn't as slow As it could have been well and think About how many things never get done at All right that's the reality is like There's a lot of things that should Happen that just get in the Log Jam so Yeah we're grateful that we're here and I think we learned a lot too about like How can we Advocate and work effectively With a government program but all in all We're just happy to be you know looking Forward now with a huge business Opportunity and a just massive Mission Opportunity to open this up and the the Early numbers have been really Encouraging like we're seeing many more New members coming in than we expected

That are using food stamps we're Learning a lot about those members Preferences and what are the products They want to see how can we make the User experience easier for them and Fortunately because we already had that Pool of Gibbs members who were shopping On site and then we already had a pretty Well optimized experience even for you Know a consumer that's maybe not as Familiar with some of the dietary tribes And quality standards and so it's been a Really fun process to say all right how Can we be a resource for Education how Can we make it simpler and easier for These folks and similar to when we Launched the business at the very Beginning what we're seeing is there's This lat demand of people that really Want access they just haven't had the Opportunity today do do you think that The USDA or something that really helped Them understand what Thrive was doing do You think that like the pandemic helped Accelerate the understanding of the Necessity of a product like this 1,00% Yeah I mean it was just a massive Forcing function cuz you you went from Before like a day prior to the pandemic You had some like small percentage of The population that was either Purchasing groceries online and like Even smaller percent they could only Purchase them online right because they

Were homebound for some physical or Whatever reason the day after the Pandemic like you had lockdowns and Literally you know nearly a 100% of People had that as their only option so I think it was like just like I said Before a really really intense forcing Function to say you know we got to do Something especially because at that Point like people didn't know how long Lockdowns would go on so when you have Folks who depend on Snap for their Groceries it's like what do we do and Initially their response was to work With brick and mortar grocers that had a Delivery option so it's you know they Have an online portal but they would Also have a brick and mortar presence The challenge with that is again if You're in one of those food deserts or Those hell food deserts where that brick And mortar grocery store isn't nearby They're not going to deliver to you so I Think they prioritized it the right way At that point and they did work with Urgency but you know again they were Moving a a big ship and it took time Logistically I imagine the pandemic was Also kind of a wild time for you cuz I Imagine you have no idea it was if You're interested in e-commerce Logistics like it's one of the most Crazy fascinating terrifying case Studies of like because on the demand

Side it was huge right like all of a Sudden our potential member base is like The whole country where everybody is is Shopping in this way I actually think For us one thing that we benefited from Was was the membership wall so we Because we charged $60 we didn't get a Bunch of people flooding in just to Stock up on toilet paper and like buy All of the hand sanitizer they can we Really did filter for people that Actually wanted to make a one-year Commitment care about Healthy Living so That helped us but it was still crazy Demand and then on the supply chain side It was like massive disruption where you Had just supply chain shortages and There was the backups at the port and Just all kinds of craziness there and Frankly the part for us that was Actually the most challenging was you Know we employed at that point about 500 People in our fulfillment centers you Know now it's close to a thousand people And those people have to show up to work Right there's no way for us to get Orders out without them being physically Present and I remember at that time like We didn't know whether co could be Spread from touching a a surface we Didn't know whether it could be like a Worker had covid if you could have Co on The products and like come to someone's Home via a box so there was so much like

Lack of information misinformation fear And our number one priority at that Point was like one we have to make sure Our members are safe and even before That we have to make sure that our Thrivers are safe Our Workers are so it Was this really acute moment for our Mission I think like the whole company Rallied around it and it was really Beautiful in a lot of ways where I think We felt as much purpose as we ever have But it was also really scary really Intense and you know I think kind of Took us to a different place for really A year and a half of the Pandemic more from this conversation Right after a quick Break And I wanted to switch gears a little Bit toward the top of the call you Mentioned that obviously dve Market is Sparked from something that was very Personal to you something that sort of a Lived experience you had as a child but Also that you had started another Company prior to thrive so I'm curious Sort of how did you know personally when It was the right time to launch this Company both timing wise for you Personally but also timing wise for the Market in general how did that all come To be yeah I mean I wish I could say I Had some grandm plan that I put together You know before each company but

Honestly my entrepreneurial Journey has Been so organic uh no pun intended where You know that my first business was in The test prep space it was very Opportunistic in that basically I had Done well in the SAT I grew up in an Area where and like from a family that Like my parents never would have paid $1,000 to do a prin review or a Kaplan Class and there was kids in my class That were as smart as I was but didn't Do well on the SAT and it totally Changed kind of what opportunities we Had getting into college and so that Business was really around access to but It was access to education to say hey It's not right that like when I got to Harvard all of my peers who had done Also very well in the SAT had been Getting tutored and getting prep and From families that really could provide Or they went to a prep school where you Know the test prep was there whereas Like coming from a public school in the Midwest you know I got lucky and I did Well other kids didn't do as well and Then that closed doors so we actually Started it was called Ivy insiders we Basically hired first Harvard undergrads But then other undergrads from across The ABY League to go back to their Hometowns and teach test prep courses so It was I wouldn't have described it as a Mission driven business at the time but

It really was and like we had a no empty Seats policy where if someone couldn't Pay for the program they could do it for Free our base price was half the price Of Prince rview and Kaplan you know I Just felt and I wouldn't have even Described that as building a business Initially it was like something I was Doing and then all of a sudden it was a Business and then all of a sudden we got To scale and then when we got an Acquisition offer and I probably sold it Too early because we were only four Years in but when I stepped back from That I just I basically wanted to do Something that was equally impactful but Had an opportunity to sort of be even More fundamental and get to bigger scale And so that's what got me thinking about Health you know I really do Trace both The businesses in a way back to my mom Because the two things that were the Pillars for her were education and Health and you know again she came from A family that was very working class you Know she didn't graduate from college no One and her family had to date and so You know me going to a four-year College Was a huge deal us being healthy was a Huge deal for her and so you know both Businesses came from personal Experiences and you know I can't say That with Thrive either I did like a Market analysis or like is this the

Right time you know probably we were a Little bit early honestly in 2014 but I Think you have to strike when there's Inspiration and know that there's going To be twists and turns you're never Going to get anything perfect and if you Believe in what you're doing and if You're right on the broad Strokes you Can get there and since this is your Second company is there anything you Learned from the experience with your First startup that you either took with You purposefully into Thrive or Something that you were like you know I'm going to try to approach that Differently this time around I mean so Much one was to the benefit of Co-founders I was a solo entrepreneur on My first business the second was having Investors where so it's not all of your Own money on the line you know creating More just like stress and intensity I Think the third was being in a big Market like test prep was a good siiz Market but even as we got quite large There was a ceiling on how big that Business could get I think another was Just the power of the mission which I Saw like as we got going with I insiders Even though I wouldn't have called it an Access oriented Mission it was and that Became this rallying call both for our Customers and for our employees and I Wanted to do something like I said even

More fundamental and the only thing from My perspective more fundamental than Education from an opportunity standpoint Is is health so all of those things were Things I learned that said you know I Was 26 when I sold Ivy insiders I was 28 Or 29 when I started Thrive and like I Thought I learned a lot but but I also So subsequently have found out how much I still had to learn and Thrive has been It's it's been a very humbling Experience where the greatest asset in In this company has been all the amazing Team members we brought in and the most Important kind of skill I've had is just Recognizing the skills that I don't have And bringing in the right people that Align with the mission but have very Different aptitudes and really different Talents and skills so that we can go out And and make the mission work yeah and I Was actually gonna ask you about that Because it seems like you have four Co-founders yeah how do you how does That work like how do you divide Responsibilities is there any like egos Like what's the like how does it work How does it work yeah I think like you Know being solo is not enough maybe four Is is too many but honestly again I I Don't think you can like engineer or Control that like gar had the original Vision and the mission and he and I got Together we first worked with like an

External agency to build the platform Spent hundreds of thousands dollars of Our own money and got nothing for it and So we said all right we need a technical Co-founder and that's what brought Sasha In none of the three of us had Experience building a Lifestyle brand And so that was the The Genesis of Bringing in Kate who is our she's like Brand and content you know we're not all Day-to-day with the business anymore Both Kate and gar have have stepped away And and done other things Sash and I are Still here but I think at those critical Junctures each of us brought really Different things to the table and I Don't think we could have built like we Wouldn't have gotten where we've gotten Had all four of us not been there at Those CR critical points were there Clashes of Personality are there ego Issues of course always but I think if You have good people who believe in the Mission you know that becomes again that Like that sanity check and all four of Us really did in a way that I think Ultimately has enabled us to be Effective and also be like self-aware of When it's the right time for someone to Step away operationally what are their Skill sets that we need outside the Co-founding team so yeah it's not all Flowers and whatever the expression is But I think we've been really lucky to

Just set like good people with that core Team and that's allowed us to I think From there build a great team beyond the Co-founding team and talking about Building out that team I did want to ask Because I'm always interested when you Are talking about such a mission Oriented company of course you're having People come to the company who have Backgrounds in the roles they're Applying for you have people coming who Are literally applying because they're Obsessed with the mission they're really Want to make that kind of a thing happen How do you when hiring but also working With your underlying employees how do You help balance The mission driven side but of course The this is a for-profit business Sometimes we have to make hard decisions And things like that like how do you Find you can kind of walk that line I Love that question and I I'll answer it In two parts because first I think There's an assumption on that tension That you described that you know kind of The mission and the business opportunity Are like two separate things and that They're going to come into conflict and One of the things that we really work to Do with the teams and one of the things I really believe at just like my core is Is that that doesn't have to be the case Right that it doesn't have to be Zero

Sum and in fact the mission can really Be a catalyst to the business and that If you are creative enough you should Always be able to find a solution that Honors and like seizes on the Opportunity of both sides so I know that Sounds like very abstract but if you Look at the membership model like the Membership model enables our economics To work but it also Powers the mission With the Thrive gives program if you Look at carbon neutral shipping that's Something that it costs us money Obviously to do that the plastic waste Reduction that we do in in the packaging The consolidation of orders but all Those things also create loyalty and Differentiation and you know real like Member engagement and honestly like Member evangelism where they're so Different than what most companies do When a member talks about Thrive with Their friends they're not talking about Like oh I saved $3 on my almond butter They're saying isn't this amazing what This company does and like you know my Membership sponsored a free one for a Lone come family and yada yada y they Like to talk about the mission so I Actually think it's been an asset we've Also looked at like really specific Things like when we went zero waste in Our fulfillment centers we looked for Opportunities that not only reduced our

Waste but also improved our efficiency Those efforts have been Roi positive From a business standpoint you know when We've wanted to raise quality standards And we've gone up the supply chain to do Private label oftentimes that's actually Allowed us to capture more margin and Cut out different middlemen and Consolidate and make our business more Efficient those are a few examples but They're all over the place where I feel Like we've been able to pursue the Business opportunity through the mission And the challenge that we give to our Employees to our thrivers is that's the Name of the game that's what we have to Do we want to show that a stakeholder Driven business can also be a Shareholder driven business that those Two don't have to be intention that's Something I'm really passionate about And then to the point around hiring we Just used again the mission is the Screen so just like we run every Strategic initiative through the mission To decide how we prioritize it we do the Same thing for people I think what we Find is that one the miss attracts People that are very talented because a Lot of people that have great skills Also have great expectations and they Want to do something with their time and With their energy that matters so I do Think it's a really positive selection

Factor and then I also think that when You get people into a role that aligns With their purpose it turbocharges their Level of Engagement you know there you Get the discretionary effort and the Collaborative qualities and also like Back to the question around kind of ego Like you get a lot lower ego I think When people really are aligned with what You're doing as a business so I feel Like the mission is our superpower in Every respect but I think especially With people and with energizing the team It's been absolutely huge and I would Say it's even more important now in a Remote first environment where you got To get people to be connected despite The fact that they're not seeing each Other every day you need people to be Working hard despite the fact that They're not coming into an office every Day and I think if we didn't have the Mission all of those things would be a Lot harder and I know that we're kind of Running out of time but I did want to Touch upon the social impact arm that You have and just kind of when you Realized you wanted to launch that and How things have been going I mean it's Been really since the beginning I assume When you say social impact you're Talking about the access oriented side So we we kind of think about the mission As there's two Dimensions one is access

One is sustainability so it's health for People and health for the planet and you Know on the planet side we're doing all The stuff with carbon neutral shipping Zero waste fulfillment plastic neutral Becoming a public benefit Corporation Just baking all of that sustainability Into our business on the access side I Actually feel like that is in the core Of the membership model to begin with Because we our membership model enables Us to offer at a price point products That wouldn't otherwise be accessible to Middle class middle Americans and if you Look at our paid membership base we have 1.5 million paid members they are Average household income under $100,000 50% are in the Midwest and the southeast Well over 60% of incoming members are Families so we are hitting that goal of Really being expansive inclusive Platform but for the specific kind of Access oriented initiatives those are Things where we've tried to go even a Step further to be able to access people That aren't just middle class but Actually working class or people that May be in real Financial need and so There you know we start with giving away The free membership we also raised more Than $13 million through donation at Checkout this is another good example of Something that doesn't hurt the business And actually helps people because we're

Not paying those dollars it's actually Our members who are donating those Dollars we just serve as the conduit we Just facilitate it but those dollars go Directly into the shopping budgets of Our givs members and enable them to get Further discounts on the platform so When I kind of zoom out today and look At you know if you're a low-income Family what Thrive can offer you well First you can come online get a free Membership second you can use your food Stamps online third you get these stip That are funded by our membership Community so that you get even further Discounts on the platform and so you Know the the ultimate Vision there is Like let's break down all the barriers That we can for fol no matter where they Come from what their background is and Again today we have you know hundreds of Thousands of active givs members I want That number to be in the millions as I Said before there's 40 million Americans On food stamps so at some point it Should be in the tens of millions you Know we feel like we've done a lot but We're we're really just getting started Unfortunately we are out of time but That feels like a perfect place to wrap Up anyway so thank you so much for Coming on the show today this was really Fun thanks to you Both and that was our conversation with

Nick Dom before we dive in what was the LIE the lie was obviously that Nick Realized a year into building the Company that he needed to switch all the Packaging to be sustainable that is a Lie because Thrive Market has always Been sustainable and they've been carbon Neutral practically since the beginning No it's so good to hear that too because I feel with companies that are are Marketing themselves as sustainable Businesses there's always like little Holes that they don't think about from The beginning like it's obviously so Much more difficult to build in this way And you always hear of Brands being like Oops like they packaging we it never Occurred to us that delivering this way Was bad for the environment or like we Didn't know that the caps on our plastic Bottles did XYZ and they're like so We've changed it which is good but it's Like you so rarely hear about companies Who like actually know we actually Thought all of it through from the Beginning and have been doing that the Whole time yeah I know I was trying to Think of like cons to the business model But I couldn't find any holes like it Just seems that they do what they say And there's no like gotcha you know yeah Cuz like I wanted to be like well $60 Obviously for a lot of people doesn't Feel like a lot to spend on this but if

You're struggling to buy groceries Already that would seem like a lot and Then they're like no we give them out to Those people for free and I was like Well okay do I of course you do of Course you do of course you do oh I know And especially when he talked about how They became like the first online Grocery store to accept Snap and EBT Like that's so interesting it's crazy to Think of how much the Pand played a role In maybe moving that a little faster Than it would have gone otherwise I know Like I I remember the first time I Realized that Whole Foods also accepted It and I was like oh I was like this is Actually really cool this is like Convenient this is you know modern I Guess in a sense like I don't know I Never really thought about it but I was Like okay cool Whole Foods is like cool I guess un biased cuz that's where I Shop but to per Thrive Market to also Accept it I just felt like it was so Like with the times I guess I don't know Like people want organic food and they Want I'm a delivery girl so so you know You want to be able to get it online and It's kind of like beating the customer Where they are and I'm not surprised That the US da was a little slow on it Cuz like it is a big ship I guess but I'm glad they caught on cuz now I think That that's like a really useful way to

Use the food stamps and what he said too About when the USDA first started Looking to like pilot this and they went With healthier grocery stores to start And they quickly realized that I was Like well no half the issue here is that These people don't live near those Places to begin with so it's like they Can't get those groceries delivered from Whole Foods from an equivalent like they Literally don't have access and then the St was like oh okay time to like I feel Like this must have been I don't want to Say it was smooth because it probably Wasn't but like this must have been like One of the smoothest like I'm pushing The government to do something and they Actually did it yeah I know because it's Like no the problem is they're not near The Whole Foods duh like what but cuz Like when you're talking about the Government there's always or at least I Feel like there's always Hoops there's Always hurdles there's always something There's always drama so I was expecting A story of like chaos but of course it Wasn't that it was just like they were Just a little bit slow to get back to Them but then realized it and I'm sure The pandemic also really helped make That make sense because it's like well You can't even go into the Whole Foods And then you don't live near one and Delivery fees are high come on girl so

Yeah it's interesting to think of just Like how how much the pandemic helped This company in general like they were Founded 2014 so founded obviously six Years before that happened but like Nick Was talking about like no one bought Groceries online then and some of us I Know you were not in this Camp some of Us still don't so it's like it's hard I Remember when I bought magic spoon for The first time and like the fact that I Was like buying cereal online and Shipping it to my house felt insane so It's like that it was nice that they Were able to still be able to grow Despite people not really having that Natural behavior of buying that kind of Stuff online and then obviously the Pandemic helps with that I know I'm Thinking of all like the conspiracy Theories you could have like it's 2014 And someone's like yeah I'll like Deliver groceries to you or something Like that and you're like what is this Like is this real is this true like I Could just think of how odd that might Have seemed at first I mean now it's Like I mean I just got my groceries Delivered today I don't know what he did When he got all everything I don't know Don't really care I got the food but in 2014 I would have been like you're going To do my grocery shopping that's a Little odd yeah so it's been pretty

Impressive that they've been able to Grow this whole time cuz like 2014 oh my Gosh the old days that was like 6 years Before the pandemic so they convinced a Lot of people before online grocery was Even cool to kind of work with them and The one thing I do wish I asked him About with that is that since they got Started especially because they don't do Perishable products I know they do Frozen stuff which obviously has a short Time span to get delivered and things Like that but Amazon has added so much Stuff like that to their website and Even if their like grocery delivery Service didn't take off like I can go Online and order banza chickpea pasta on Amazon today if I wanted to and it's Like I'm curious if that affects the Competition at all because I know the Membership obviously helps people get Lower prices at Thrive Market but I mean Amazon is like an absolute black pit of Deals and buy this from this person and Blah blah and I personally don't think That's a great system so maybe that's Why people don't do it and choose to Stve but I definitely wish I'd ask them More about the competition cuz it does Seem like you could get this in other Ways yeah I know I would also like to Know more about the logistics of it cuz I was just thinking about I'm like if You live in a food desert and you're

Ordering something like I don't know Meat or something that parishes or ice Cream how do they ship it to you that Fast this is also me probably not Knowing much about shipping Logistics Overall but I'm like where are they that They can just get it to you super fast Or like much faster than a store in the Area That wouldn't have it could because I'm Like if someone can ship to that area Then surely those grocery stores in the Area could pair with a bigger retailer To just get that food to begin with yeah It's such like a low margin business too Just like groceries in general that it's Like hard to even like I don't know how Easy it is for them to set up that kind Of stuff but maybe it is I feel like I Know more about this than most people Because I read about it but I definitely Don't know everything no yeah now I'm Going to go down the Deep dive of Logistics oh you should it's so good Well what do you know what do you know Cuz now I'm really curious what do you Know about shipping Logistics well I Know that the majority of the produce And stuff you buy at a grocery store Sits in warehouses within the set Driving distance from the grocery store And they keep them there in a state Where they are not ripe yet and then They flash ripen them and ship them to

Stores So when you buy like apples at The store sometimes they were picked Over a year ago e okay so like when I Think of Flash rpe and I think of like An apple under a lamp and then they turn On a lamp and then it like something Like that ew This is why America's I Went to when I was in Europe last week I Was telling everyone I was like finally I can eat dairy because I was like you Don't know what they're serving us over There he like I can't eat the dairy over There I have to eat as much cheese as Possible right now oh yeah I mean can Like give so much Faith to the US Food System in general but at least like Drive Market they're like no dyes no This no that like I they're trying to Give us that nice European food model And delivered from online it's so novel I love it it's such a luxury actually Thinking about it non-poisoned food and You get it online it's Perfect found is hosted by myself TechCrunch senior reporter Becca scac Alongside senior reporter Dominic madori Davis found is produced by Maggie Stamitz with editing by Kell our Illustrator is Bryce Durban founds Audience development and social media is Managed by Morgan little Alysa Stringer And Natalie chman Tech crunch's audio Products are managed by Henry pikovit Thanks for listening and we'll be back

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