Crista Freeman, Co-Founder of Phin & Phebes Ice Cream
Get to know the cool ladies behind Phin & Phebes Ice Cream as they share how they turned their love for ice cream into a successful business. The advice Crista shares should be read by anyone seeking out knowledge on starting a business for she explains her process thoroughly. Now, I haven’t had a chance to try all of their flavors because they’re always sold out at my local Whole Foods, but I must say Banana Whama is my favorite.
Location: Greenpoint, Brooklyn
Founded: December 2011
Title/Occupation: Co-Founder & CEO
Education: BFA from California College of the Arts
Favorite quote: “Be so good they can’t ignore you” ~Steve Martin
Social media handles: @phinandphebes
Can you give a brief introduction about your company? What were you doing before launching Phin & Phebes Ice Cream? What inspired you to start making ice cream and when did you know you should turn it into a full-time business?
Previous to Phin & Phebes I was working as a manager of eCommerce where I essentially oversaw development, design, online marketing & SEM / SEO campaigns.
Back in February 2010 we bought an underwhelming pint of ice cream, which compelled us to buy our own ice cream machine and make our first flavor called “Fluffnut”. This flavor happened to turn out pretty phenomenal, so we continued to make more flavors each weekend becoming obsessed with the creative process and the limitless boundaries of making creative flavor combinations. At the time we were pretty unhappy with our jobs, so making ice cream essentially became our escape.
We tested our product for almost a year selling it for a year at markets and fairs before quitting our jobs in January 2011. We validated our brand by giving away free samples of ice cream in exchange for surveys. These surveys had pretty compelling results and gave us the push we needed to take the plunge to quit our jobs.
Would you be willing to share how you started your company (ie, funding/investor, branding, advertising, etc.)? What surprised you about the process? Was there anything that was more difficult or easier than you expected?
When we first launched our business we funded it with a combination of our own savings and an SBA (Small Business Association) guaranteed loan. When getting our loan we got approved for a pretty big chunk of change both Jess and I were pretty freaked out about being personal guarantors of such a large sum, so I rewrote the business plan a bit and restructured stuff and took out a much smaller loan. Doing this made it so that we were essentially scaling our business with our working capital, which made it hard to scale up significantly from that first push we made from making our ice cream at markets and fairs to selling at grocery stores. Taking a smaller loan made it so our margins were a bit smaller than we would have liked, and as we grew I realized we really needed that upfront capital to expand our margins even though it seemed super risky to us when starting our business. After six months of growing very rapidly and proving that we were actually making a go of it, we decided to do a Seed Round of investment in the form of a convertible note. We felt more comfortable doing that at the time since we had validated our product by getting into almost 100 stores including Whole Foods.
Currently we are in the process of doing our second Seed Round of investment.
What advice can you offer someone just starting out? What three ingredients would you say are the main factors to a successful business?
1) Test your idea or product!
I think that many entrepreneurs fall in love with their ideas and think that it is the best idea/product out there and go straight into launching the full blown product. We take very iterative approach and we are all about testing our idea before even taking it to market. The first flavor, and then the next flavor, and then the next flavor… we made in our home kitchen was awesome. Our friends all told us to launch an ice cream business and some were asking to invest in us. You can’t listen to your friends or even yourself sometimes, so we decided to bring it to the masses and sell it at markets and fairs to see first hand how people responded to the ice cream. We took this very same approach when designing our packaging. We had a color scheme we loved, but we realized that the consumer might love what we love. Realizing that the packaging is the first impression you make on a customer we decided to design around seven “color phamilies” of the packaging. We sent these out to friends, acquaintances, old co-workers & family and took a survey which color approach they liked the best. The color scheme you see today was voted on by around 50 random people.
2) Understand your cost!
So many times I hear other food entrepreneurs or just plain business owners trip up when asked questions regarding their cost and margins. If you plan on running a self-sustaining business the biggest mistake you can make is not understanding your true cost. When I say cost I mean how much it costs you to manufacture that product down to the penny, including all freight costs getting your product back to your warehouses. Only then can you price your product accurately to your customers. It is much better for you to come in at a higher cost to a customer and be able to reduce your wholesale price over time as your business becomes more efficient and you are able to expand your margins. Once you are more established you have more leverage to increase your prices based upon market changes. But when starting out if you raise your price with a store because you find out after a couple of months you are losing money then most likely they will not take you seriously.
3) Hustle / problem solve / be thrifty
When we set out to manufacture our first pint of ice cream at the co-packer I had no idea how we were going to get the ice cream from the co-packer to the storage warehouse, nor did I know how we were going to deliver it to stores that we were going to get into since no distributor would talk to us. You cannot get into stores unless you have a distributor, nor can you get a distributor until you have a list of stores you are selling to. So as you can see it’s a complete Catch 22. Also, you cannot necessarily Google ice cream freezer truck, nor could we afford to pay for an 18 wheeler to pickup our ice cream. I did some research and found a guy whose ice cream business went out of business. He still had a freezer truck that could transport our ice cream at the proper temps. He wanted to get back into the business, so we worked out a deal. He would deliver our ice cream to our stores and take a commission for that weeks sales, but I had to have a minimum amount of stores to deliver to each week. This really forced me to hustle and go out and get new store accounts each week. Within four months I had landed us 60 stores and Whole Foods was asking to bring us into all their stores within the Northeast Region. When I was making the sales we didn’t have enough money or space in our home office to store pints to give away to buyers at stores, so I would make four ounce sized samples of our ice cream in our home kitchen and had labels made for the tops of the containers. I cold called and trekked to all the stores with a small freezer bag with dry ice and literally found the frozen buyers in the aisles of the grocers. Most of my sales took place in the freezer aisle and I would bring tasting spoons and Sell Sheets to close the deal.
How does it feel to have your product in local and national stores? Would you be willing to share the process of getting retailers to pick up your product?
It feels pretty amazing to see your own product on the shelves of stores, especially when you are traveling in different cities. Its almost like an adrenaline rush, especially given our roots where we literally built our business from the ground up without any help.
I spoke on my sales strategy a bit in the previous question, but now that we are bigger I really take the same approach, but target much larger retailers. Currently we don’t work with brokers or sales reps, so I strategically target the stores I want to get in to. I have created a master spreadsheet of these stores and have them filtered by region / state. Then essentially we go about finding contact forms on those websites and reaching out them. This is usually followed by shipping samples and then an in person meeting to close the deal.
Can you describe your “it moment” when you knew you accomplished the goal you set for Phin & Phebes Ice Cream?
Ha! This is a hard one. I feel like owning your own business is like being bi-polar. Sometimes you feel like you are on top of the world and you hit that “it moment” then a week later you feel like you have accomplished nothing. I am always re-assessing my goals and evaluating the steps I need to take in order accomplish those goals. To date, I don’t feel like I have accomplished our “end goal”, but I think we are on the right track to get there. I think the reason we have had so much traction so early on is that I am always re-evaluating that “it moment”. Once I accomplish one I have already been thinking of my next challenge.
What are the top selling Phin & Phebes flavors and what’s your process on coming up with new flavors?
Our top selling flavors in order of rank are: Dark Chocolate Salty Caramel, Vanilla Cinnamon, Banana Whama…(don’t want to give away too much to competition J).
Most of our flavors are extensions of ourselves or food we are lusting over at the time. We are very much influenced by the foods we eat. For example, I grew up in the South and my favorite desserts were Banana Pudding and Key Lime Pie, so therefor they had to be ice cream flavors. Then we love Vietnamese Iced Coffees and the Chocolate Tart from Marlow and Daughters, so there came those two flavors. I think you can take it from there…
Random Fun Fact about Crista & Jess
Jess: Was a high school basketball star and is an excellent juggler. Also, she is one of the best cooks out there and makes amazing fresh pasta dishes.
Crista: Played the USTA tennis circuit, loves to surf and draw & paint. Her kryptonite is peanut butter and Bloody Mary’s.
There’s truly no right or wrong way to eat ice cream, but what’s the best way to eat your ice creams?
We love eating ice cream straight up out of the pint, but with a ice cream koozie to keep your hands warm and your ice cream frosty.
What can we look for from your company in the coming years?
We want to change the way that people think about ice cream, so the only way to do this is to get our ice cream into as many hands as possible. So, over the next couple years our primary focus is growing our brand nationally and growing our brand awareness as much as possible.
Evernote: I get a lot of emails, so I love to use this app to screenshot important things that I need to come back to or add to a to do with a to do date.
When it really comes down to it my main productivity tool is a good old pad and paper and I utilize Evernote so that I can always access any notes. I use a Rhodia Dot pad to keep my to do list and take notes. I usually tear out my notes and scan them in use a ScanSnap scanner where I tag specific keywords from those notes and add them to Evernote so I can search them later. I am usually transferring one to do list to another list since my page will run out of room. When I do that I usually scan in that old to do list and tag it with keywords just in case there is something that I need to access later on.
I also utilize Basecamp for larger projects when I am collaborating with other people, but because I currently run the business on my own I find it to be more time consuming for me to log tasks and projects.
Be sure to check out Phin & Phebes website and follow them on their social channels.