Jordan Karcher is the founder and CEO of Grounds & Hounds Coffee Co., a company that believes great coffee can fuel an even greater purpose. Through sales of their organic and fair-trade specialty coffees, as well as mugs, apparel and other gift items, Grounds & Hounds supports dog rescue initiatives and organizations, dedicating 20% of all profits to making their “second chance for pups” mission a reality.
When Karcher first sought funding for Grounds & Hounds, he struggled to find any investors interested in a social impact brand. Most investors put profits above all else. So, he decided to bootstrap. He quickly achieved positive cash flow by focusing on e-commerce. This strategy worked, and in 2018 he attracted private equity investment. Today, his company is shipping nearly 1 million orders directly to coffee lovers’ doors through the country.
“I’d be lying if I said that when I founded Grounds & Houds in 2014, I envisioned that the majority of our sales would be generated through e-commerce,” Karcher said in an exclusive interview with me. “We were an early user of Shopify, but 90% of my attention was focused on creating a great retail brand. However, as e-commerce evolved, paid media effectiveness expanded, and our mission scaled, we recognized the value and opportunity in creating a powerhouse D2C business unit and supporting supply chain infrastructure. This approach has allowed us to create a much closer relationship with our rescue dog-loving, coffee drinking community. We are able to learn what products they love, dislike, and want in real time.”
For nine years, Karcher has remained committed to the core mission of Grounds & Hounds, which is to provide resources to rescue pups in need and to provide the perfect excuse to slow down and enjoy 15 more minutes with your “human’s best friend” each morning. He feels strongly that integrating that mission into the products has allowed the company to build a stronger community and brand.
“I’m 100% aware that the fastest way to create a brand these days is through a shared antagonist, and it does work,” Karcher says. “However, my vision has always been about the overlapping commonalities of the animal loving community. Dogs serve as the best ice breaker to meeting strangers, sharing stories, and becoming friends, which is why we prioritize keeping this shared love of dogs in mind in everything we do.”
Here, Karcher shares his seven best practices for founding and running a successful business that does good.
1. The mission is the message, but the product is key. The CPG space has become far too innovative and competitive to think that your mission alone will drive success. It is crucial to put as much, if not more, internal focus on product and customer experience as you put into the mission.
2. Integrate customer feedback into your product. In the early stages of launching your venture, the most valuable resource you can accumulate is customer feedback. The faster you can aggregate and integrate the desires of your audience, the faster you can find true product market fit.
3. Keep up with the times. Unless you launch your business the day after you generate the initial idea, the world will change by the time you reach the marketplace. It’s important to avoid building concepts based on trends of today. Search for fundamental pillars and principles that do not come and go (i.e. great product at a great price, providing joy, eliminating a pain point, solving a problem), and allow for flexibility in your communication and marketing strategy to ride the wave of the moment.
4. Structure for scale from day one. People who create social impact ventures are never short on passion for their products or their mission. However, I often see companies built in a manner that will never allow them to scale to achieve their full potential, thus not allowing them to achieve the objective of their mission. Spend ample time thinking through how you can scale if, and when, the product demonstrates traction.
5. Create a community, not just a customer. A significant difference between a “do good” brand and a standard CPG brand is that the mission-driven brand serves as a conduit for likeminded people to connect versus simply consume. Therein lies the greatest strength and most valuable reason for creating a mission-driven brand. The more effectively you can engage and connect your supporters to the brand and to each other, the more effectively you can build higher lifetime value and referral value (i.e., less money needs to be spent on customer acquisition and retention and more can be dedicated to your product and your mission).
6. Integrate your story and mission into every element of your product and messaging. Ten years ago, the concept of social entrepreneurship shifted from creative problem solving to simply adding a donation aspect to a standard product already on the market. While the donations are likely welcomed and needed, there is no true demonstration of commitment to identifying and addressing an issue. The brands who have had the most success in the mission-driven CPG space weave the mission into the very fabric of the products, the company, and the voice. If you aren’t already part of the community or ecosystem that you’re looking to support, and if your brand isn’t actively working to address the key issues that advance the cause, then you’re likely going to be ignored by the audience you’re intending to engage.
7. Success is a process, not an event. When I launched Grounds & Hounds Coffee nine years ago, I had visions of massive growth in short spurts. While there have certainly been rapid growth phases, the true success of the company has come in the form of compound interest. Leaning on a principle from athletics, the key is to focus on improving 1% each day. It’s not a single heroic effort that will lead you to success, but rather consistent execution day in and day out will drive long-term success.
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