Nick Saltarelli - One Foot in Front of the Other - [Founder’s Field Guide, EP. 54]

**Patrick O'Shaughnessy** (0:00)
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Hello and welcome everyone. I'm Patrick O'Shaughnessy and this is Founder's Field Guide. Founder's Field Guide is a series of conversations with founders, CEOs and operators building great businesses. I believe we are all builders in our own way. And this series is dedicated to stories and lessons from builders of all types. Founder's Field Guide is part of the Colossus family of podcasts and you can access all of our podcasts, including edited transcripts, show notes, and resources to keep learning at joincolossus.com.

**SPEAKER_2** (1:06)
Patrick O'Shaughnessy is the CEO of O'Shaughnessy Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Shaughnessy Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions.
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**Patrick O'Shaughnessy** (1:31)
My guest today is Nick Saltarelli, Co-Founder of the functional chocolate bar business Mid-Day Squares.
Nick started the company with his wife and brother-in-law a few years ago to build on a simple idea. If the big chocolate bar brands were to start today, what would they look like? In our conversation, we discussed the importance of Mid-Day Squares $100 million revenue target, what's wrong with the CPG industry today, and how to keep a long term mindset while making the most of every day. Please enjoy this unique conversation with Nick Saltarelli.
So Nick, we met yesterday. I meet so many interesting people just chatting about your business over Twitter. Maybe just begin by telling us what Mid-Day Squares is, like literally what is the product and how did you think to start the business?

**Nick Saltarelli** (2:14)
Yeah, so I like to say a lot of people like to put us in the bar category, but we're really trying to reinvent what a chocolate bar is. So Mid-Day Squares, we call it a functional chocolate bar.
The number one question I always get after is, well, what's a functional chocolate bar? It's meant to give you a little bit more than just that sweetness and that kick. So the whole bar was designed to curb cravings, give you hunger coverage until your next meal. We called it Mid-Day Squares because you're supposed to be hitting it in the afternoon. But more importantly than anything, the hypothesis of the company has been simple. If Hershey's, Nestle, Mars started today, what would those companies look like? In our opinion, they definitely would be bringing to market the chocolate bars that you know them so well for. My wife came up with the recipe for it. She was making the product for a while. It was not obvious at all that this was going to be a business.
Then what made it the business was I got a piece of data. I can't name it publicly, but from someone in M&A.
I love reports. Any type of reports, I love reading them. I was just reading it and what was so fascinating, I had heard through so much reading that plant-based proteins were on a tear.
But the real chocolate report was really interesting. So real chocolate is chocolate that can't use palm kernel oil, has to be above 50 percent in cocoa mass and can only use irregular sugar. So no sugar, alcohol, none of that stuff.
The report from 2009 to 2017, this type of chocolate was just seeing unprecedented numbers.
It was led by companies like Lindt, Hugh Chocolate. What was so fascinating to me when I was reading the report was, everybody that was in the real chocolate category, and I think this is why largely big titans in the industry missed it per se, is if you went to go look at the plant-based category, it looked like chocolate bars had existed, but all of the bars in the plant-based category that had function and used chocolate were not using real chocolate. They were using chocolate couverture, which is palm kernel oil-based chocolate, and it's really shitty. It's like a thin little one-millimeter chocolate experience. On the real chocolate report, what was fascinating is every single bar that was there was rectangular in nature and really thick, and that's where that moment was. Les, who's now my wife, was my wife at the time, was making this product for me. We were roommates, and it was just like, this is the thing that we got to bring to market, and that was 2017 We went, we went and made that product happen because I felt that there was just a huge opportunity in chocolate.