The direct-to-consumer business model has officially taken off. Not only can a Netflix (NFLX) customize entertainment for your personal preferences, but a company like Stitch Fix can match you with a personal shopper who sends you handpicked clothes in the mail.
Now the snack business has NatureBox, founded in 2011 by Gautam Gupta and Ken Chen, once an overweight teenager who started out as a venture capitalist before jumping onto the entrepreneur track. The concept is simple: Enter your taste and diet preferences online, and the team at NatureBox picks out the perfect bags of snacks for you.
Along with growing a following among bloggers and foodies, and collecting almost a million Facebook fans, the company has recently raised $18 million in Series B funding. We talked to Gupta about his success so far and his plans for the future.
CBS MoneyWatch: Why did you decide to start NatureBox?
Gautam Gupta: I had spent about the seven years prior working for a venture capitalist firm investing in e-commerce companies that were at the forefront of the direct-to-consumer shift and believed food was the next big thing in that area. From a personal standpoint, I've always loved finding new foods, but as a teenager I actually struggled with obesity. When I was 17, I started learning about nutrition and lost about 70 pounds. Starting NatureBox was a way to combine my passions for business and nutrition.
MW: What was your biggest fear when you started NatureBox?
GG: It's a brand new concept in the food industry. The biggest challenge is proving that this concept will work -- that consumers will buy food online and trust a new brand. Then, how do you grow from one box to hundreds of thousands of boxes per shipment?
MW: What gets you up in the morning and excited for your day?
GG: I'm always excited when I'm talking to people and they've tried the product. We're so passionate about what we do. It's always great to hear that feedback and have the opportunity to change how people eat. Also, it's great to be able to take an idea for a product and get it into the hands of a consumer in just two to three months.
MW: What's your favorite NatureBox snack?
GG: One of my personal favorites is called a Dark Cocoa Nom Nom. It was inspired by a childhood craving for sweets and brownies. We added whole grains and dried fruit, and took out a lot of the sugar and fat. We started working on it a few months ago and launched it last month. It's doing incredibly well.
I also really enjoy spicy food. One of my other favorite products is Siracha roasted cashews. A number of people in the company loved Siracha, the hot sauce. When we put snacks out in the office, it's always one of the first to go.
MW: What's your typical day at work?
GG: I get into the office at about 7 a.m., and my morning routine is to check metrics. We're a direct-to-consumer business, so we have a lot of data and we're constantly monitoring that. The bulk of my morning is spent catching up on the day before and deciding what we need to focus on that day and week ahead.
I spend a lot of time with the rest of the management team, understanding what they're spending time on and where we need to focus our business.
I also try to connect with customers. I monitor Twitter pretty actively for customers who are tweeting at NatureBox. I often respond directly to them. Also, I'll call customers who have just signed up. It's a great opportunity to connect with them, discover how they're finding out about us and discovering what we can do better.
MW: What advice do you give young people who want to be entrepreneurs?
GG: Focus on working with great people. Whether you're thinking about starting a company or taking your first job, it's all about the people you work with, whether it's your boss or peers or investors. It's so important to work with people who want to see you succeed and want to be helpful.
MW: What CEO or other executives do you most admire?
GG: My dad. He wasn't a CEO or a Fortune 500 executive, but he taught me a lot about hard work and the value of creativity, and thinking about how you're going to solve a problem in a creative way.
MW: What's next for NatureBox?
GG: We've grown really quickly. In the short term, we're trying to continue to improve customers service and grow the direct-to-consumer business. We're also building our engineering and science teams. We've started to use the data that we have to enhance the experience.
Looking even further, we're working on ways to expand the NatureBox brand beyond online. We look at NatureBox as a multichannel brand that has the ability to go offline, too.