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Petti Fong When you began, what was opening day like?
Ratana Stephens We couldn’t make a flake. I remember thinking, If we can’t make a single flake, how is this going to work? Arran had spent hours painting cereal boxes by hand. We had this facility that was supposed to be turnkey but wasn’t. All these people showed up…
PF What happened?
RS Arran got boxes of cereal from the supermarket and placed those flakes on the machines so when it came to taking photographs with the guests, it looked like the flakes had just come out of the machines.
PF Were they Frosted Flakes?
RS I will never tell!
PF How did you get back on track?
RS I took out $250,000 from family money and sat down with Arran and the accountant and said, “You have to pay this back in six months. And this is how you’re going to do it.” He did. Arran never lost faith in the product. The company became profitable within six months. This time he listened to me.
PF What is it like having your grown children work for Nature’s Path?
RS When they were little and they misbehaved, the punishment was that they’d have to drink some wheatgrass. Nowadays, they don’t make me drink wheatgrass, and I’m so glad to see all of them become wonderful adults. They care about the things we cared about when we started. My daughter Jyoti has always been the sustainability champion, and she still gives me orders. When I put food waste somewhere inadvertently, like the garbage, she says, “How could you do that?” I tell her, “Oh, I’m tired. My legs aren’t happy.” And she says, “Just do it.” I do.
PF Ten years after starting with breakfast cereals, you finally moved on to snacks with the acquisition of the Que Pasa brand of organic tortilla chips. When will you grow into lunch and dinner?
RS Early on, when we had our restaurants, we wanted to serve lunch and dinner. But if you don’t have a lot of capital you focus on what you’re good at. For us, it was cereals, granola bars. Que Pasa made sense: it was also a family-owned business with whole-grain products; we could distribute it within our existing channels. In our heart, we’re still entrepreneurs, and if lunch or dinner opportunities come up, we’ll go there. We’ve shown that organic, vegetarian food is not a fad.
The Stephenses founded Lifestream Natural Foods (annual revenue: $9M) in 1971. They sold it in 1981, then bought it back from Kraft at a deep discount in 1995. In the interim, they launched Nature’s Path