Sweet Loren’s: Loren Castle. How A Recipe Makeover Built a National Cookie Brand

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4:17I'm talking every day in my apartment. I would just test different types of potato starch and tapioca starch, you know, in different proportions of it. So honestly, it was just so much playing around. I tried to hire food scientists to help me because I thought that, like, that would be the easy solve. And the food always tasted like a science project.

Starting Sweet Lauren's

4:56Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on the show today, how Lauren Castle made cookie dough taste good, even without gluten, dairy, and eggs, and then grew that into Sweet Lauren's, a brand that sold in more than 30,000 stores. A lot of founders think that to build a great brand, you've got to come up with a totally original idea.

5:32But the fact is, a lot of really great products and the brands built around them are simply more creative versions of what's already out there in the market. For example, Graza Olive Oil. The founders realized most people have no idea how to choose olive oil. So they made it simple. Three oils for three different uses. Two for cooking, and one for drizzling on salad or tomatoes. They packaged it up in a fun, squeezy bottle, and it's become a national brand in less than four years.

6:05In fact, we really should do an episode on it. Anyway, today's story is precisely about taking on a category that wasn't very innovative. Refrigerated cookie dough. And for most of the past few decades, it was dominated, and probably still is, by tubes of Nestle Tollhouse. So when Lauren Castle decided to start selling her own brand of refrigerated cookie dough, she saw an opportunity. Not only to offer up an alternative to the usual brands, but eventually to make it gluten, allergen, and dairy-free, and vegan.

6:37Which sounds like a buzzkill for a cookie. I mean, you kind of want all those things in a cookie, right? But what if you could take all of those things out, the gluten, the dairy, the allergens, and actually make the cookie dough taste good? That was how, over many, many years, Lauren was able to grow Sweet Lauren's into a national brand that's now sold in more than 30,000 stores across the country. And the thing is, Lauren used to sell cookie dough that wasn't gluten and allergen-free. But when she launched it as an option, it quickly outsold all her other cookies.

7:12So she pivoted and turned Sweet Lauren's into a brand entirely aligned with consumers looking for an allergen-free cookie that didn't taste like cardboard. Lauren managed to build her business despite dealing with some pretty big personal challenges. As a teenager, her mom was diagnosed with cancer. And later, Lauren was diagnosed as well. And it was while battling cancer herself that she developed an interest in healthy eating.

Early life and health battles

7:40But before all that happened, Lauren Castle grew up in New York City in the 90s. Her dad was an entrepreneur, and her mom was a busy attorney. My mother was a founding partner of a law firm, Jacobia Myers. Oh, wow. And I just remember her stretching herself thin because she was trying to make business events out at night or dinners with friends. But then also, you know, we were her priority as the kids. Yeah. I remember, I mean, everybody remembers that law firm because they did TV ads.

8:12It was like one of the early TV ads. It was the first law firm to advertise nationally. And she was the face of the brand in a lot of the commercials. Really? Yeah. And so, you know, and she was, you know, one of the early female partners of law firms. So she was pretty groundbreaking. Wow. Jacobian Myers. It's wild. Wild. It's in a Beastie Boys song. Exactly. It made it to pop culture. I got more suits than Jacobian Myers. Exactly. We used to sing that all the time. So in some ways, I mean, I mean, obviously your life doesn't begin, you know, at age 14, but it really a profound change happens in your life.

8:52Because I understand that your mom was diagnosed with cancer when you were 14. Is that right? Yeah. So it was a really crazy year because it was my first year of high school and my parents got divorced. And then later that year, my mom found out that she had a type of leukemia. This all happened in, I mean, what a year. One year. It was a crazy year. And I really started to feel like an adult from that day on. And how, I mean, what was your mom's battle like?

9:24I mean, was it sort of periods where things seemed totally fine and normal and she seemed healthy and periods where she was just in bed and getting treatment? And I mean. Yeah, she was so fearless and from the outside seemed so healthy and vibrant. And I think anyone that knew her would say that. So she had over a decade battle trying to, you know, moments when she seemed really healthy. But it just, it kept coming back. Wow. And you, in that time, went through high school and college, you went to USC, I think.

9:59Yeah. But you, your mom was in New York, so you would probably go back and forth, I imagine. Yeah. And I guess you, you're done, you graduate, and you are, I think the plan was to end up living back in California, right? When you were 22? Exactly. I loved California. And I was like, let me go back home for the summer. My younger sister's going to start applying to colleges. I can do college visiting with her. I can check in on my mom. And then after the summer, I'll figure out my life and what I'm going to do.

10:30So I went to New York for the summer, and I woke up one morning, and the lymph nodes in my neck were so swollen that I just knew something was off. But like more swollen than it would be if you had the flu or some other infection. Yeah, so my mom looks at my lymph nodes, and I think as someone who was dealing with cancer, was like anything with lymph nodes was really scary to her. So I went to her doctor, and he said, you either have nothing at all or Hodgkin's lymphoma. So they did a biopsy through my neck, and, you know, the doctor called my mom a couple days later, and the doctor said, we have to start chemo immediately.

11:08I was diagnosed with stage 2 Hodgkin's lymphoma. Wow. All right, first question I think most people want to ask is, is that, I mean, what's the prognosis for a 22-year-old with stage 2 Hodgkin's lymphoma? So stage 2 has a really high chance of being cured. My doctor felt very positive about it, but he just wanted to start the treatment immediately so it didn't become stage 3 or stage 4 when it gets harder and harder to reverse.

11:41And so, you know, he looked at me and he said, we're going to get through this. And I decided to believe that, you know, that is what I held on to. I mean, I can't imagine what it felt like for you. I can't imagine what it felt like for your mom, who was in the middle of her own battle, and now her child is diagnosed with cancer. I know. I'm sure my mom was like, how much more can I handle? Like, why me? Like, how can you watch your kid go through that?

12:14And, you know, she really was my sole support. So I think that's why I tried to pick myself up as much as possible because otherwise it was just too hard, I think, for both my mom and I. I mean, you get this diagnosis, you're back to go to California. Clearly that's not going to happen.

12:36You're not moving to California. I mean, was that clear to you that that plan was out the window? Yeah, unfortunately. I actually, I had bought a one-way ticket. When I went to the doctor for the first time, he was like, no, no, no, you're canceling that plane ticket. And so when I got the diagnosis, I mean, I really, for the first time in my life, felt what it felt like to be depressed and just kind of hopeless and scared. Like, I just remember the first couple of treatments were really, really hard on my body.

13:11I was dizzy.

13:13My appetite was off. You know, I just did not feel great. And then I'd finally start feeling better. But then you'd have your next treatment every two weeks. So then all of a sudden you'd feel not good again. And, you know, this cycle would happen. And so I started seeing a therapist. And just in one of the sessions, something clicked where, you know, I was kind of complaining about the, when will I ever make it back to Los Angeles? And what if this haunts me my whole life? And she looked at me and said, don't you see how it actually could be such a positive?

13:49Do you see how you could actually get through this? And this could make you stronger, more empathetic, appreciate life more, feel stronger than ever before. And something in my brain just clicked when I heard that. And I was like, you're right. All right. So I think 2007, you complete the treatment for cancer. And at this point, are you going to go back to, you know, go to California and follow through with your plan? Yeah, that was originally my plan was, okay, the second I'm done with treatment, I'm going to go right back to California.

14:26But I just couldn't. Like, my mom wasn't getting better. And after the treatment was done, you know, my doctor looked at me and was like, okay, like, go be normal now. You're clear. You know, we'll do checkups every six months, but no big deal. He was saying, all right, you're 22, 23, go get a job. Exactly. Okay. So you don't go to California. You stay in New York City. And I read that you worked at a bunch of different jobs that I guess didn't quite pan out. But there was one job that you, I guess you did like, which was at Levan, the very famous bakery in New York City.

14:59So what were you doing there? Were you a baker? No, I actually was like the salesperson in front dealing with all the customers. And this is when they had one location. Yeah. And I just, I saw people line up down the block for fresh, warm cookies. And, you know, I saw the joy and the excitement and like the highlight of people's day was getting this delicious fresh cookie. And so I could not believe how people would travel internationally, you know, from all different parts of the city, every age group, you know, for fresh cookies.

15:35And then what I also thought was so interesting is that out of all the products that were sold in the bakery, you know, they do breads and muffins and brioche and cookies were the number one, you know, product sold and the most profitable. And there was just something, you know, that was really interesting to me about that. I was like, I think this is America's favorite food.

Baking as therapy and markets

15:56But when I was going through treatment, I decided to take my health very seriously. And so I started to study nutrition and take cooking classes. And there was all these books about vegan baking or healing benefits of coconut oil, which again, it wasn't a thing back then. Like this was so niche. Nobody talked about inflammation. No. Exactly. And I became obsessed because I started to buy all of these ingredients that were just not mainstream yet.

16:29You know, falling in love with whole grain, healthier flours, like throwing out the white bleached all purpose flour that's in most cookies. And, you know, it's still a cookie, but make it feel like it's made of real whole ingredients. So, all right. So, you're, I guess at a certain point, you were, you started to make a bake cookies and sell them at a farmer's market? Yeah. So, every time I'd come home, I'd want to bake.

17:00And I think baking became kind of my therapy. Like it was just calming. It's happy. And I actually was so intellectually stimulated by how difficult it was to replace a classic chocolate chip cookie recipe with these more natural ingredients. So, no, no unbleached flour, no flour, no wheat flour. No, no wheat flour, no eggs, no dairy, you know, no corn syrup, nothing artificial. Wow. And I was just determined because I am obsessed with a warm chocolate chip cookie.

17:33So, I kept coming home at night and playing with recipes and really studying and understanding how does Stevia work in a recipe? How does monk fruit? How does cane sugar? How do they all interact with one another? And I have a younger sister who, you know, I would like leave a cookie plate out with like four different types of cookies that I'd made that day and give her like a chart to fill out. So, I just kept testing them on friends and family until I started to see like my sister say, this is the best cookie I've ever had.

18:05And seeing the reaction of friends and family over and over again, be like, I love what you're doing. Can I buy some from you? You should really do this. Like, this is cool. This is different. And I entered a baking contest and I won. This is like a local baking contest? Yeah. In just New York City, a small baking contest. And the judge was a famous pastry chef and she came up to me and said, you need to do something with this. And that was the catalyst for you to try and sell them at a farmer's market.

18:39Yep. So, Smorgasburg, that was a famous one in Brooklyn and that was in like the heyday of it. So, it was actually like really fun. It was super busy. That was where Oprah used to like have her people go and scour and discover things. Exactly. And there was a lot of cool products. So, I got a booth there. And how would you advertise it in the farmer's market? Would you, because it wasn't what it is now yet, but like what would you say? So, by then it was called Sweet Lauren's. This was the early days where like it's not like it was branded and crisp and really professional.

19:12But like when people passed the booth, it would say like organic cookies, natural cookies. All natural. Okay. Yeah, exactly. And actually, you know, I had other things besides cookies there. I had these muffins. I had brownies. It was mostly cookies. But I had a couple different things because, again, I just wanted the market to tell me like, what would you buy? What are you missing in the market? What's interesting to you? And I mean, what, how was the response? I mean, was it like, what did you, what did you find?

19:42So, the response was overwhelmingly positive. Like people would line up. I would always sell out. People would say to me, I love this concept. Can you sell this in grocery stores? Can I just buy the dough from you? Because then later at home, I can make them warm and fresh with my kids. And cookies were always the things that sold out first. And, you know, people asking to buy the dough was really interesting to me. Because then I started to like look into supermarkets and, you know, Whole Foods was my local supermarket in New York City.

20:18And I was like, there's no packaged product I would be excited to buy and bake off in my own home. Okay. So, you have this burgeoning farmer's market business. Meantime, it's just you. You're baking cookies. You're going to the farmer's market. And are you still working other jobs to supplement your income? I'm teaching yoga on the side because that was the only thing that was super flexible. And I think I had a short stint at farmer's markets.

20:48It was only probably, you know, a couple months because I hated it. Like it was too hard as a one-woman show to pull off. Like it is so labor intensive. You know, you have the whole table and like bringing all the products and standing on your feet and testing the product. And what if it rains or it just was too unpredictable. But it was like a great place to try the product, sample the product, and get the confidence. And honestly, hear that consumers wanted something in a grocery store.

21:19And I guess around this time you take a – you get accepted in this program. Like I guess it's a – maybe a New York City – or nonprofit or it's a community program. It's like a two-year free business school education. Yes. So it was part of Columbia Business School. And so I did that for two years. And I started to write a business plan for Sweet Lauren's to figure out what kind of product would I launch. Was it going to be shelf-stable, ready-to-eat cookies?

21:50Was it cookie dough? Was it – was a bakery a better idea? Right, because you're making cookies. So you would think, all right, let me just open a bakery like Levan. Exactly. And then I started to put the numbers behind that and was like, wait a minute. Like you have to pay rent day one. And New York City is so expensive. And on a Sunday when, you know, the faucet breaks, I'm the one who's going to have to come and fix it. And I just don't want that lifestyle. And I also wanted to reach as many people as possible.

22:20So opening, you know, one store in New York City, I just felt like I was only going to reach the neighborhood. Yeah. All right. So you're doing this program and you are trying to figure out, okay, what does this look like, right? Yeah. What is the business going to look like? And I guess in this class, you know, you're talking about what you're doing and you had a classmate who actually worked at Whole Foods. Like was it just like a stock person or checkout person at Whole Foods in New York City?

22:51Exactly. So I would bring cookies every week because I was always recipe testing something new. And this guy in my class named Corey worked in Whole Foods in the overnight shift. You know, that was his side gig to make money, you know, because he wanted to open up a bike shop. And so I said to Corey one day, how does one even get into Whole Foods? And of course, he wasn't management or a buyer, but he called me the next day and said, Lauren, I just got you a meeting with the head grocery buyer at the Columbus Circle Whole Foods, which was my local Whole Foods.

23:25I think it's also the busiest Whole Foods in New York City. I was recently there. It's very busy. It's, you know, it's New York City. It's nonstop. And so I was like, what? I could not believe that he got me this meeting. Like, like not in a good way. My website said coming soon because again, I'm still ideating what my business plan even is. Right. You know, and I was so pissed off because I was like, I am not prepared. When we come back in just a moment, why Lauren starts to ride the subway every day with her toaster oven in tow.

24:01Stay with us. I'm Guy Raz and you're listening to How I Built This.

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26:15Hey, welcome back to How I Built This.

The Whole Foods meeting

26:26I'm Guy Raz. So, it's 2011, and Lauren's friend Corey has arranged for her to meet the buyer at the busiest Whole Foods in New York City. It's a meeting, by the way, that Lauren did not request and is not prepared for. I didn't want to come off as unprofessional because, like, I didn't even know how to present Sweet Lauren's. But Corey pushed me to take the meeting, to tell the story, to bring samples. And you were going to meet this guy. I mean, again, I should just point out, 2011, this time, you could still, this is pre-Amazon, before Amazon bought Whole Foods.

27:04It was still common for Whole Foods buyers to buy for an individual store. Like, you could go to a store, and they like local products. They still do. And a manager or buyer for the store can just make a decision and say, yeah, we'll buy the product. Absolutely. And so, I took the meeting, and we really hit it off. He had kids, and he was like, I think what everyone loves about your product is, like, the melting chocolate and the warm and the gooey and the, you know, I think cookie dough is brilliant because everyone can have the best quality in their own home whenever they want.

27:43And there's white space. Yeah, it's interesting because I'm thinking, 2011, what were the big cookie dough brands, Nestle and Pillsbury, probably? That's really it. And those aren't really natural products. Right. And honestly, that's what got me more excited, too, because that was the biggest request was, can I just buy, like, a cookie dough from you so I can make this later? So, he says, I like this, but I have to meet with the rest of our team, and I have to have them taste the product, and I'll call you tomorrow. Okay.

28:13By the way, he had not tasted your—I know this sounds weird. He hadn't—you hadn't given him raw dough. You had only given him a baked cookie. No, good point, because I had never packaged raw dough before. Yeah. So, I just made cookie—I woke up very early. I'd made all those cookies from scratch. So, he was tasting freshly made that morning. Yeah. He called me the next day. I remember I was just walking on the street, and he was like, Lauren, my team is so excited. We've never tasted something this good. How soon can we get this as cookie dough?

28:44And I just started to cry.

28:48So, Whole Foods wants to sell your cookie dough, which is great, right? But I just want to pause here for a second, because at the same time, I think this was also a very tough period for you, right? I mean, on the family front, your mom was still fighting cancer, and I think it was getting worse. Yes. So, my mom, you know, the chemo treatments weren't working anymore, and she was 65 years old.

29:18Her doctor recommended a stem cell transplant, and so we got a donor, and for the first year, nothing really changed. And so then, after the first year, they decided to do another infusion, and she had just had a terrible reaction to that. And a couple weeks later, she was in the ICU, and she ended up passing away. She actually passed away right after I verbally got into Whole Foods, but before we actually had cookie dough on shelf.

29:59And because she'd been fighting it for, you know, over a decade, we almost felt like she was invincible. Like, oh, she'll keep figuring out how to get past this. So, it did come as a shock, you know, at any age. I think it's just so hard to lose a parent, especially when you're close to them. And my mom really was my best friend. Did the focus on having to get this done and figuring this out, did it, in a sense, give you something to really just distract you?

30:34Absolutely. So, I think between not having an emotional safety net and really wanting to distract myself with something happy and positive and something that was growing and exciting, Sweet Lawrence did both of that. I just felt like this is my road out of here. Yeah, I mean, it's interesting how, you know, we've had stories on the show in which people talk about just the clarity that you get when you have to focus.

31:09And it's in many ways a gift when you're dealing with trauma because it focuses your brain. And I guess it's a double-edged sword because it doesn't allow you to process entirely, but also it allows you to not become immobilized by the grief. Exactly. I think I, you know, I've done a lot of therapy. I've tried to process this my whole life, but I think I'm so grateful to Sweet Lawrence because I could process my own grief of getting sick, losing my mother, into something that could then be a real benefit.

31:48Yeah. And so, meanwhile, I mean, you managed to get your first order of cookie dough into the Whole Foods in New York. And when the buyer agreed to carry it, did he give you like an amount of how much they were going to take, like a certain number of cases or whatever? Nothing quite yet, but he was like, we're going to start small. We're just going to buy for this store, you know? So I think when people hear like, oh, you get into Whole Foods, it's going to be billions of orders overnight. It's like, it was the opposite.

32:18It's like eight units a week. Exactly. It was really tiny amounts. So I was making these in my kitchen. And so when he placed an order, that's when I started to research factories because there were plenty of people that like rented out commercial kitchens and made their own product in commercial kitchens. But I think in the very beginning, I realized like I am a one-woman show. There's no way I'm going to be able to make the product, sell the product, sample the product, demo the product. And like I have to find a factory that can make this, and then I'll have free hands to kind of do everything else.

32:53Right. And so, I mean, is that hard to do?

Finding a factory and scaling

32:57I mean, there are got to be plenty of factories that do, you know, co-manufacturing for cookies and baking. And I mean, this is slightly different, but I mean, was it that challenging to find a place? It was so challenging. I mean, I think things are easier today, but a lot of factories, you know, kind of keep themselves secretive or they're not good at marketing. And so it was so hard. I just started calling dozens and dozens of places.

33:28You know, I found some factories that were very large scale. So they're like, I'll run your cookie dough recipe, but, you know, you have to produce 10,000 pounds at a time. And there was just no way I was going to say yes to that yet. You know, I was in one store. I wasn't going to do a huge batch, and then all of a sudden something's wrong with the batch, and we have to throw the whole thing out, and I'm losing thousands of dollars. Like, I couldn't even afford that. So I found this tiny factory in upstate New York. I didn't have a car, so I took the bus like two and a half hours up to it.

34:00They'd never made cookie dough before, but they had mixers, so that's all you need. They were prepared to do cookie dough and to package it for you. Yes, and keep it cold. That was the most challenging part, was when you were in only one store to begin with. And it's not like some big distributor was going to take Sweet Lauren's on and deliver, as you said, you know, eight units to a Whole Foods. So I actually hired a guy who worked at the factory to put it in a cooler in his trunk and deliver it into the city.

34:38Okay, I got it. And here's another question, which is, your story, your personal story, was really compelling. I mean, you had been diagnosed with stage two, you know, cancer. You beat it, and it changed how you thought about food, and it inspired this cookie brand. There's two thoughts around this, right? On the one hand, it's cool. You could tell that story in the back of the packaging. I mean, that was the story of Andrew Abraham and Orgain, right? The other side is, you know, it might be too much about that rather than about the product, right?

35:13And then people might be thinking, oh, is this going to be, like, for cancer awareness or for charity or does the money go? Do you know what I mean? Like, people might start wondering, oh, is it the proceeds go? Is it, like, Newman's own? I don't know. Did you – were these thoughts going through your head at all? All the time. I, in the early days, really actually didn't like talking about the story because, first of all, it would bring me back to, you know, a challenging – Yeah, re-traumatize you. Re-traumatizing. Yeah.

35:43And also, I didn't think it was that appetizing. I was like, why are we talking about this when we're talking about food and – Cancer and food, sweets. Trying to, you know, make people happy and bring joy to people. In the back of the package, like, this is a bummer. Right. And people are crying. You know, I did not want that. Yeah. But I will say, I, you know, I just listened to my gut and studied people and my interactions. And I just saw over and over and over again how me being vulnerable and telling that story actually became so humanizing for the product.

36:21And it made people want to support me. It made people understand that there was something different about how I've chosen each of these ingredients. So you put the story from the get-go on the back of the package? I did, from the get-go. So a photo of me, a signature, and a little story of it. You know, a couple sentences. Okay. And we're going to get to how it evolved over time. But initially, it wasn't, like, vegan or dairy-free or wheat-free, right? So it was – the original recipe was – had wheat, but it was low gluten and it was dairy-free.

36:57Okay. But it did have egg. And that first year that I was in that one Whole Foods, I demoed the product. Like, I was that girl with a table every week. And I would bring a rolling suitcase with a toaster oven in it on the subway to the Whole Foods, plug it into the aisle, and stand in that aisle for three to four hours demoing fresh cookies. You know, I think a lot of people forget you can actually bake cookies in your toaster oven.

37:27It's not just for shrinky-dinks. No. And it's not the easy-bake oven. Exactly. You can actually bake your cookies in – you can make a roast of chicken, small chicken in a toaster oven. I use my toaster oven more than I use my regular oven. Do you really? I mean – oh, my gosh. Yeah. All right. Okay. So you're doing that – you're baking them at Whole Foods in the toaster oven. Yeah. Which is great because it takes, like, what, 15 minutes to bake? Less. Yeah, like 10, 12 minutes to bake. And people are obsessed with the warm smell. Of course. You're getting free chunk of cookie.

37:59Freshly made chocolate chip cookies. That's a good thing to get. So it's interesting also that you were in that Whole Foods, right, because location does matter. And I think one could make the argument that, like, oh, you want to be in a Whole Foods in, like, San Francisco or Los Angeles, which is where food trends begin in the United States or, like, Boulder, you know. But actually, to me, this makes a lot of sense. And in some ways, you were really lucky. You were in New York City at that Columbus Circle Whole Foods because it is so busy.

38:31You have a lot of single, young professionals, and this is, like, a great product for a young, single professional because you could – if you had toaster oven and you didn't want one cookie, you could do that. Yeah. No, exactly. I was so grateful it was so busy because I, for sure, was meeting 1,000 people a day, and that was, like, incredible feedback. And New Yorkers are picky. They're honest. You know, it was a really good group to be around if, like, I could make a New Yorker appreciate this cookie who has access to a lot of high-quality food.

39:06Yeah. You know, I think we could be successful everywhere else. Okay. So you are in the Whole Foods at Columbus Circle. And then how soon after before they're like, hey, we want you in a few more stores? So they never said that. I had to say that of, hey, I want to get into more stores. So after a couple months, I got the confidence that we were selling enough every week. I knew that consumers loved it, and I could handle demoing at a couple other stores. So I went to a couple other of Whole Foods nearby.

39:39Then, you know, the business, you know, got into Fresh Direct. Got – you know, in the Northeast, it started to take off a little bit, and there was this excitement. And then I got on the Today Show. This is early on, in, like, 2011, 2012. Early on. We were really only sold in the Northeast in supermarkets. But I got on the Today Show, Hoda Copy, became a huge fan. She came in and, you know, to the Whole Foods when I was demoing once and got samples. And you told her your story? Yeah.

40:09And she had already been a breast cancer survivor at that point, I think, right? That's exactly right. And she said to me, when you're ready, I'm going to put you on the show. Just email me. So being – I mean, that must have been a huge – I mean, this is pre-TikTok and Instagram. So being on Today Show, 2011, awesome. But you're only available in a few Whole Foods in New York City. So we started shipping from our website. Okay. So that you could buy at SweetLaurens.com and, you know, get it anywhere in the country.

40:40And so I get on the show and I literally could not use my phone for 24 hours because of the amount of inbound calls from people across the country that had questions, that wanted SweetLaurens sold at their local store. And I just – my gut was like, the whole country is excited about this. Like, you've got to keep going. There's a much bigger picture here. Okay. Here's my question.

Financing and slow growth

41:05How are you financing the business? I mean, you're getting into more Whole Foods, you're on Fresh Direct, you've got a website, you're shipping. I don't think the shipping is too complicated because you could just put dry ice packs in there and do two-day shipping and it's going to be cold. But still, you need money to do this and there's no way, unless I'm wrong, the sale of SweetLaurens is enough to finance the business. So I used up my savings and then I started a small friends and family round, just friends and family that saw I was working hard or love SweetLaurens, would just put in enough so that I could figure out how to have enough cash flow just to support the growth of it.

41:49How much did you raise? So I raised about a million dollars and I tried to hold on to that cash as much as possible. So I hired very slowly. I never spent big money on fancy marketing events or a fancy office. Like, I just tried to keep things as lean as possible. Do you think that being on today's show and being in a couple of Whole Foods made it easier for you to raise that money or do you think it was friends and family who just really liked you and liked your family and believed in you?

42:22No, friends and – I was amazed how difficult it was to raise from anyone, especially friends and family. I mean, in my head, I was like – Hey, it's me. My mother just passed away. I need help. You know me. I'm trustworthy. You know how hard I'm working. I couldn't believe how hard it was. And so I just had to take meeting after meeting to find people that loved entrepreneurs and that, you know, believed in me or wanted to see me succeed. And it's part of why I just – I wanted to figure out how to get to profitability as fast as possible so that I wouldn't have to raise again.

42:57This is now – we're getting into like 2012, 2013. And I think by this point you're in, what, more than 10 Whole Foods? Yes, I'm in – I'm probably in 300 stores.

43:11But this is interesting because this is now – 2013 is – I think the economy is really more or less out of the – emerging from the low point of the financial crisis and its aftermath. And money is starting to flow again, especially to CPG, direct-to-consumer brands. I mean this is like when, you know, Warby Parker and Tom's Shoes and all these, you know, Harry's Razors are raising lots of money. What's going to define your brand over the next, you know, I guess seven, eight years from 2013 to really to 2020, 2019 is actually quite slow growth.

43:55Like it wasn't – you weren't going to go 30, 100, 300% next year, 500% growth. Like it was going to be more incremental. I think I was learning how to run a business for the first time. Yeah. This is obviously my first business. I think I was biting off as much as I could handle and I didn't hire a big enough team to really support more than like Northeast growth.

44:29And so it was a hard couple years because I knew I had something special, but I just felt like I was a little early to the market where I was ready to go. But I don't think the rest of the country was absolutely ready to support, you know, a better for you brand in our category. Yeah. I mean I think I first saw your brand probably only in like 2022 and I just assumed it was a brand new product even though it had been around since 2011 that I now know.

44:59But in many ways I actually really like that. I like that incremental slow method even if you didn't necessarily like that because a lot of people in that – in your space were hyperscaling. Some of those brands don't exist anymore. You're lucky that you didn't actually grow that fast because it didn't – it meant that you didn't have to dial for dollars every, you know, six months. No, and I appreciate that because I do actually think it took longer, but it felt sustainable.

45:32I also didn't know what I didn't know. There were so many aspects that I had to wrap my head around. I lived in that state of anxiety and stress for all those early years. It was so overwhelming to me. You know when you have like a hard day and you work so hard and your like head actually hurts? That happened to me every day. You know, we were growing, but it wasn't this, you know, incredible growth where everyone was like, oh, you've now made it. And so I had to do all the deep believing in Sweet Lawrence.

46:05You know, my accountant, I remember saying to me like, are you sure this business is, you know, worth it? I mean, I'm assuming you were paying yourself through the angel money you raised, but do you remember what you were paying yourself? You had to pay rent? You had to have, you know, had to pay your food and costs? I think I paid myself $85,000 for those first couple years. I tried to take as little as possible. Even though I wanted a fancier lifestyle, I just, I looked at every dollar like it was worth something.

46:41And so I lived in a studio apartment in New York City and I raised my bed like three feet off the ground so I could keep huge containers of all my ingredients under my bed. And my friends also, you know, just graduated from college. They're getting great jobs. They're now a couple of years into their great jobs. Like they're getting raises, they're getting paid more. They're definitely out partying more than I am. And I'm, I'm pretty, you know, attached to this business and kind of whatever it needed, I was going to give it.

47:19When we come back in just a moment, why Lauren decides to raise the bar even higher by creating cookie dough without gluten, nuts, soy, dairy, or eggs. Stay with us. I'm Guy Raz, and you're listening to How I Built This.

Switching to allergen-free recipes

47:48Hey, welcome back to How I Built This. I'm Guy Raz. So it's the mid-2010s and Lauren is figuring out how to grow her business without going out of business. And one of the things she's struggling with is finding a reliable factory to make the cookie dough. I now was at like my second factory and all of a sudden one day I got a letter in the mail from this factory saying, within three months, we'd like you to close up business with us and be out of our facility. I remember being just so shocked, so upset, so pissed off.

48:23I couldn't believe they couldn't like have a phone call with me or like bring me into their, you know, have a professional meeting. Like they know this is my livelihood. They know this is a small business. They know this is a really big deal. I asked them for six months and they said, okay, we'll let you stay six months. I mean, they really didn't specialize in cookie dough. They did it better than my first factory, but they weren't doing this at a national scale. And so it actually was a great force function because it made me go back to the drawing board to find a bigger factory that like really specialized in cookie dough and the right packaging and figure out how to, you know, really create something that could finally get me out of the Northeast and get me nationwide.

49:05So during this sort of time, from the time you get in the first Columbus Circle Whole Foods until like 2016, this is like a five-year period of mainly regional growth, right? Mainly like Northeast before you would go national. But it was like by year five, let's say, or year four, do you remember what your annual sales were? By year five, we were probably 350,000.

49:37A year in sales. A year in sales. So you were tiny. We were tiny. Wow. I was thinking you were going to say like seven, eight million dollars. I mean, again. Under a million. I really, I, this is, I mean, this is very refreshing because everybody wants to just hyperscale. And people, and legitimately people are worried, especially in CPG, that if you're not fast enough and you've got a successful product that's noticed, somebody is going to just replicate it and have a better marketing plan and more money and beat you.

50:07But actually, I think people worry about that too much. I mean, this is a good example of that because if all of a sudden, you know, Nestle wasn't just making Toll House dough but was making birthday cake cookies and, you know, like replicating what you were doing, I'm not sure it would work. No, I don't think it would. I learned that a lot in the first couple years. Because people would say, you have to go faster, like someone could just create their own recipe and come in and copy you and, you know, even the factory that you've left, you know, could like use your recipe and, and after being in it for about four or five years, I realized it's not that easy.

50:51It's actually so incredibly difficult to break into CPG. And it's not just about one thing. First of all, a recipe isn't just a recipe. When you talk about, let's say, oat flour, there's hundreds of different types of oat flour. It's not that easy just to, you know, replicate every single ingredient we have. We specially pick, you know, our ingredients out of hundreds and hundreds of different types. So I think there's just like so much complexity even within recipes.

51:22And then there's brand. You know, it doesn't make sense for, let's say, an artificially driven brand to then all of a sudden create a natural version. It's like, you know, what do you stand for? Who are you? Okay. So by year five, you're still not profitable, but you are bringing in enough cash that you're not really burning through your cash that quickly. As we're scaling into more supermarkets, I need more staff. I need more support. And so, you know, the bigger we got, the more it was eating away at, you know, whatever I'd saved from that original friends and family.

51:56And so the next big jump that the business had was getting into Publix, which is one of the largest grocery stores in the country. Incredibly powerful and does a great job. And I emailed the buyer and he said, yes, I'd actually love to meet with Lauren because the refrigerated cookie dough category has been flat or declining for years. So, like, I've got to do something to reinvent it. So I take the meeting and I fly down the next couple of months for the real review time.

52:28And he says to me, you know, can you supply all chain, like all of every single door? Are you set up for the success of this? Are you? And I tell him, absolutely. If you give me this chance, I promise you, I will not let you down. How many Publix is that, by the way? There's about, there's over 1,200 Publix. So you're going to be in 1,200 Publix, okay. So I'm so excited. And then I'm like, okay, this is the year Sweet Lauren's takes off. So I brought in a food broker to help grow the food service.

52:59And he lived in Cincinnati. And he gave some samples to his neighbor. And his neighbor called me and said, I'd like to have a meeting with you. I work at Kroger. I just baked off your cookies for my son and he absolutely loved them. And of course, I want to give him natural and better for you ingredients. Right, because Kroger's based in Cincinnati. Based in Cincinnati. And Kroger is the largest, you know, supermarket in the country. How did you manage to fulfill what they needed you to fulfill? I mean, they need scale.

53:29They, I mean, how did you do it? Once I got into Kroger, I hired a COO to help manage the factory and logistics and ingredient buying. And then I raised from some friends and family and an angel investor to have enough funds to manage this national growth. And presumably to attract this high level talent, you were also going to have to be willing to give them equity in the company, significant equity.

54:00Yeah, I was, I was happy to, I was happy to say, if you join now and I'm not going to pay you a huge salary, but I will give you some equity and I can now pay you, you know, a salary so that we all need to live. But be in this with me for the impact you can have for like the growth, because it's not going to be easy. And then I got the call that we, you know, we got into all doors of Kroger and all doors of Publix in 2016. It completely changed the business.

54:32So overnight you go from being in 300, you know, regional grocery stores and mainly in the Northeast to like four, like something like 4,000 stores. It's a category that's already flat. You want to really be part of its, you know, pushing its, its, its, its, the reversal of that. So what are you going to do? So what I wanted to focus on was word of mouth, the customer having an incredible experience and the packaging popping off shelf as much as possible so that it would do the advertising for us.

55:10Did you change the packaging at that point? We did. We really leaned into magenta as our color because against the competition, it really popped off shelf. It felt very modern and fun and joyful and vibrant. And we just kept getting good response from people. So we leaned into magenta and then, you know, we had our call outs of why we were different on the package. Okay. What about sampling? It's a big investment. When you're in a few Whole Foods or even a few hundred, you, you can manage the sampling and getting the word out.

55:40But sampling is critical, right? It costs money. We didn't do it nationally. It was too, too big of an investment. And we didn't think that anyone else could kind of replace me or, or us. So we decided just to put it on the shelf and be, again, strategic. So we really focused on, on testing out a bunch of different promotional sales that would go on in the store and, and word of mouth. So it'd be like $2.99 a pack instead of $6.99 or whatever.

56:11Yeah. Instead of, you know, $5.99, maybe it's two for nine or something like that. So that you're just driving people to, to say like, that looks interesting. I've never seen that. Let me give that a try. And it was placed right next to the Toll House in the Pillsbury? Right next to the big guys. That's where we always wanted to be. And tell me about how it's, how it does. So it does fine in that it's not doing terrible.

56:41Everyone loved the concept. But was it different enough from the big guys to really get attention, really command a higher price point than they were? Really, did people feel like it was different and worth it enough? Because it wasn't organic, right? It was never organic. And was that something that people on your team were like, let's just slap organic on there? People would say that, but then the price would have been even more expensive.

57:13You know, we would have had to raise the price. The ingredients would have been more expensive. And honestly, I've always listened to the consumer. And consumers weren't asking for organic what they were asking for. Because now we're basically sold in every state being, you know, in Publix and Kroger supermarkets. So I'm getting, I'm reaching every type of family. Like, this is my dream. Like, what do people think? What do they need? An overwhelming response. Hundreds and hundreds of messages from all different types of families that were like, I am so excited to see finally something new and exciting in the cookie dough section.

57:50But my kid has a nut allergy. Right. Or my husband is gluten free. Or soy free. Or soy free. This was just incoming social media messages and on Facebook. And I just realized I didn't have the funds to buy expensive research. This was such gut feeling. And just these hundreds of messages of people, as you say, that were proactively emailing me. I was not asking them this question. I was not trying to survey it. And I realized, like, this was such a white space in the market.

58:24And I wanted to make sure that there was cookie dough that was delicious and made of, like, trustworthy, better for your ingredients. But I couldn't let, like, to hear all these other people who had food allergies not be able to eat it. Like, I just couldn't let that happen. So it sounds interesting. And I know we get this all the time. But that, to me, isn't a validation of what will work. And so if a lot of people are writing in saying, I want allergy free. I want allergy free. Maybe you could just look at the data and say, well, or I want gluten-free.

58:59Like, what percentage of Americans are celiac? Probably half a percent, maybe a little bit more, not many. I think 1% of Americans are celiac, but almost 20% have some dietary restrictions or food allergies. And so it's not as niche as everyone thinks. So people are writing in saying, if only it was free of this, if free of that, but then what does that mean? I mean, can you make a cookie free of – you can't make a cookie where – because there's always going to be somebody who's like, I'm allergic to, you know, to sodium bicarbonate.

59:37I'm allergic to – you know what I mean? Everyone knows somebody who has an allergy, and you're like, I don't even know people are allergic to that. Well, exactly. And I have no food allergies. I can eat everything, but I couldn't deny how many messages I was getting. I mean, it was hundreds. And also, I felt like the Sweet Lauren's product on shelf wasn't going to win the way I wanted it to being just a little bit better than what the other guys were doing. So for four months, I worked on this recipe, getting rid of really the top allergens.

1:00:12What are they? So soy, gluten, dairy, eggs, nuts, sesame seeds. Those are the main ones. I just wanted to get rid of the things that were the major allergens. And after a couple months, I did a small test run at a factory I found. Eventually, I found a factory that was close to me in New Jersey, and I was in New York, so I could drive there, which was huge. So they were doing some allergen-free, like, baked cookies.

1:00:45And so I said, well, if you can do baked cookies, can't you just do the cookie dough for me? Yeah. And they said, yeah, we'll figure it out. So I said, okay, let's start small so I don't waste thousands of dollars and figure it out. So I created this recipe, and I remember the first test run. I remember baking off those samples, and I remember I was tearing. I remember my VP of sales was tearing. We both were like, we hate gluten-free products, and this tastes so incredible. But how did you – I mean, if you were using eggs, if you were using, you know, other things, and then you take it out, what do you –?

Developing the final recipe

1:01:21A ton, a ton of recipe testing. I mean, I'm talking every day in my apartment, I would just test different types of potato starch and tapioca starch and different proportions of it and baking soda, work with my oat flour to kind of – because all an egg really does is bind. So honestly, it was just so much playing around. I tried to hire food scientists to help me because I thought that, like, that would be the easy solve. And the food always tasted like a science project.

1:01:52Like, when some food scientists would help me, it never tasted like a warm, delicious homemade cookie. It tasted weird. Okay, so here – so this is interesting because this is going to actually transform your business. But this is 2017, I think, so you're about six years into the business, and you had basically been making cookies the same way. Now you're going to – are you going to introduce an allergen-free version, or is everything going to become allergen-free?

1:02:22Great question. So I show this to the Publix and Kroger buyers and say, based on consumer feedback, I'm really seeing requests for this. And they said, you know what? We're getting that feedback too. People want more options that are gluten-free and dairy-free in the store. So let's try it out. So I made sure that the package kind of screamed gluten-free and dairy-free, because I wanted to make sure that they didn't confuse it with the original. And we launched that in 2017, and it became our number one SKU.

1:02:56It outsold everything else. In six months. And it was a chocolate chip cookie, allergen-free. Chocolate chunk. So clearly this is a differentiator. And how quickly before your team is like, we got to just make a call here. Like, should we do allergy-free and non-allergy-free? Are we going to use different manufacturers, or are we just going to go all in on this? So we talked about it, and there just seemed like there was no point in having two different lines, because the allergen-free line tasted just as good or better than the original line.

1:03:34It didn't taste gluten-free. So why have two different lines? I just felt like it was so confusing for the brand. And the refrigerated dough space is quite competitive and small to begin with. So after six months of seeing the success of this, we said, let's, by next year, make all Sweet Lauren's products free of the top allergens, and let's change our packaging so it doesn't scream gluten-free anymore. And that way, even though we'll have our gluten-free call-outs and dairy-free and, you know, nut-free and all of our call-outs on the package, it's not going to be the most prominent thing.

1:04:10It'll be small enough where the people who know, know. Exactly. The people who don't notice it won't notice it, right? So this is actually why I think you were very lucky that you didn't scale quickly in the same way, that you actually grew slowly. Because had you been a, you know, a universally known household-named national brand in 2017, when you introduced an allergy-free line, and then in 2018, when you decide to completely change the business,

1:04:40then it might be odd for people, oh, all of a sudden they're going allergen-free. But because I think you were, people were discovering you for the first time in 2018 as an allergen-free cookie brand. Exactly. And I think that doing all that took a lot of time. And also, I think, I think I saw so many other brands try to break into cookie dough and not succeed. And I think it's because they were just not different enough.

1:05:10So I guess in 2018, all the products, and I think you're still primarily making cookie dough in 2018, we'll get to what you're doing now, but everything is going to be vegan, going to be non-GMO-wise, allergen-free, dairy-free, gluten-free, peanut-free. Everything you sold was going to be that. Yep. And I think the thing about cookie dough is, is that, again, a lot of people can make cookies from scratch, but it is so difficult to bake gluten-free and vegan.

1:05:47It took me, you know, hundreds of recipes to get there. Okay. Today, from what I gather, the refrigerated cookie dough market category in the U.S. is about a billion-dollar business.

Profitability and national reach

1:05:59Exactly. So that's today. This is 2018. It's probably more like $500,000, $600 million at that point. Yeah. This was a turning point, obviously, for the brand and for your bottom line, because I think this 2018 is the first year you became profitable, fully profitable. Exactly. And after struggling and figuring out product market fit and all the years of building this, to be able to feel like I was finally building a healthy business that was profitable, was growing, it was so differentiated.

1:06:37So would you estimate, like, by the end of the first year where you go fully allergen-free, are you, like, $5 million in sales? We're doing about $3.5 million. Okay. So, all right. So you have, I think, by 2021, you're in 13,000 stores. I mean, today you're in, like, 30,000-plus stores. But you start to go beyond just cookie dough. So you get into puff pastry, pizza crusts, pie crusts. That all, you know, eventually, I think, recently gotten into scones.

1:07:15And I think last year, I've read that you were projected to do sales over $100 million in 2025. And you're privately owned, so, you know, that you don't release your numbers publicly. But clearly, you're much, much bigger than you were in 2011 and even 2016, because now you're, what, 14 years into this business. Yeah. We have 40-plus employees now, and we've made it to the Inc. 5000 list for the last eight years in a row consecutively as one of the fastest-growing companies in the U.S. that's privately held.

1:07:54We're growing up finally. It's about time. You started it when you were so young. What do you think about the sort of the long-term game plan here? I mean, there are some investors, and you've got a significant business, allergen-free category. I mean, you could go public one day or possibly more likely, you know, one of these big players may want to buy you. What do you imagine? I mean, you know, if one of these big companies is like, hey, you know, we're ready to talk.

1:08:30Like, I just can't, I can't really think about that yet, because I feel like I've worked so hard to get Sweet Lawrence to this next platform where we truly are distributed in all the major retailers. We are profitable. And my five-year-old asked if she could take over the company when she's older. So I really love it. I think I've found my thing, like the thing that gives me joy.

1:09:01I think it's, I am not planning on stopping anytime soon. I really enjoy the work. It's a lot. It was my first kid, and the bigger it gets, the more consuming it is. But I just, I just want to really enjoy this, this time and keep it going.

Looking forward and reflection

1:09:20When you think about, you know, the journey you took and, and I mean, the ups and downs and the slow growth and then the fast growth, how much do you think of, of where, of where you got to has to do with luck? And how much do you think has to do with the work you put in and the grind? I am grateful and I am lucky to be healthy, to be here, to have three healthy children, to have a great partner, to have figured out the business. But I've had a lot of unlucky things happen too that were, you know, a huge challenge for me.

1:09:54And I think what I did was I just looked at those challenges and said, this isn't going to be my story. Like, I'm going to dream of a happier, fulfilling, abundant life, and I'm going to do whatever hard work I need to do to get there. That's Lauren Castle, founder and CEO of Sweet Lauren's.

1:10:41With research help from Alex Chung. Our engineer was Jimmy Keely. Our production staff also includes Casey Herman, Chris Messini, Sam Paulson, Catherine Seifer, JC Howard, John Isabella, and Elaine Coates. I'm Guy Raz, and you've been listening to How I Built This. I'm Guy Raz, and you've been listening to How I Built This.