This is an installment in a special series, Startup Year One, interviewing startup founders about the major lessons they learned in the immediate aftermath of their businesses’ first year of operation.
For pet owners, keeping their best friends healthy and happy has seemingly never been easier with new direct-to-consumer pet food producers or toys delivered on demand. Still, if only our dogs could talk and tell us how they’re really feeling.
Launched in January 2019 by cofounders and childhood friends Kari Sapp and Stefan Lewinger, Goodboy uses a proprietary algorithm to help pet owners quickly identify health issues and goals, while providing their pets with high-quality supplements that specifically target each dog’s needs.
Fortune recently spoke with Sapp and Lewinger to learn more about their first year in business, the lessons they’ve learned, the hurdles they’ve overcome, and their plans for the next year.
The following interview has been condensed and lightly edited for clarity.
Fortune: What inspired the launch of Goodboy?
Sapp: The whole idea behind Goodboy was super personal for me. A little over a year ago, I was inspired to create Goodboy after my dog Finley was diagnosed with a rare form of cancer. At the time, she was a healthy, young, 4-year-old Labrador retriever with no health issues. The diagnosis came as a total shock to me. Outside of feeding her quality dog food and maintaining a steady exercise routine, I realized that I could be doing so much more for her health, not only during her treatment process but also long-term as well.
With Finley as my catalyst, I set out to create a brand that would redefine the way modern “pawrents” proactively cared for their pets. I reached out to Stefan, and we decided to team up and build Goodboy, a partnership that was very organic from the start. Stefan and I have known each other since we were kids. We’ve been friends for years and had previously worked together for about three years; I headed up content marketing at the D2C subscription company he founded in 2013. Professionally, my background is in PR and marketing, having worked previously in both corporate and startup roles. So deciding to develop a brand like Goodboy was a no-brainer.
Lewinger: I grew up in a family of entrepreneurs and creative people. My mother was an artist and a teacher. My brother is a celebrated ceramicist out of Brooklyn, and my father is a lifelong business owner and entrepreneur himself. So I guess I learned a lot of what I know by osmosis, you could say. I started my first company a few years out of college and grew it to a multimillion dollar brand with over $10 million in lifetime revenue and a spot on the Inc. 5000 list of fastest-growing private companies in North America.
I was fortunate enough to be able to surround myself with people much smarter and more talented than me, and one of those happened to be a lifelong friend and colleague, Kari. We would often get into long conversations at work about what else we could do to apply what we’ve become so good at with Sock Fancy [Lewinger is CEO and cofounder of the socks subscription service] to something new, exciting, and where we could really make an impact. When the unfortunate news came down about Kari’s beloved dog, Finley, and the feeling of hopelessness and desire to be able to make an impact in her dog’s life and health, the idea for Goodboy was born.
Wellness products for pets is a space that has seemingly exploded over the past couple of years. Why do you think that is so?
Sapp: I think as a whole, people view pets less as “just animals” and more like family members. Recently, millennials eclipsed baby boomers in pet ownership. There has been a notable shift in millennials when it comes to having children, many putting this decision off until later in life or choosing not to have children at all. With this shift, their focus has moved toward their pets, really prioritizing their wellness, well-being, and long-term health. Things that were once seen as splurges—pretty much anything outside of your basic grocery store pet food—to prior generations are now viewed as necessities or requirements for this new age of pet owners.
Lewinger: In addition to the younger generations’ willingness to splurge on their furry family members, I think we’re starting to see a halo effect of sorts from the wellness and self-care culture over the past few years. There has been an overall increase in awareness for products that help us take control of our own health by creating healthy habits, eating real food, and taking important vitamins and supplements. Brands like Care/of, Ritual, and even Goop have transformed the self-care markets for humans, and now we’re naturally seeing that spill over to the pet space, resulting in the explosion in demand.
Beyond tapping into dietary trends like grain-free and keto-friendly (and even meat-free, a rarity in dog treats and food), how has technology shaped the development of Goodboy, whether it be the influence of big data or social media?
Sapp: Technology has had a huge impact on Goodboy from the jump, starting with our quiz process. We built a custom algorithm that determines the best supplement plan for every dog, according to their specific needs. Our data collection through this quiz process has really allowed us to harness users responses to more effectively and efficiently power end results. We not only use this data to ensure that each dog gets on the most impactful supplement plan but also to influence our future product offerings, making sure our decisions are based on what our customers actually need and not solely on industry trends or assumptions.
Lewinger: At its core, our business is built on technology and driven by data. It allows us to be super nimble and responsive to what our customers need and want to see from a pet wellness brand and provides us the tools and information we need to iterate quickly, stay ahead of the competition, and gain a competitive advantage in what is going to become—and, in some respects, already is—a very competitive market.
What were some of the biggest hurdles you faced in the past year? What surprised you the most?
Sapp: One of the biggest hurdles has been reshaping our thought process behind “growth at all costs.” When you launch a new D2C brand, it’s hard to not get wrapped up in the growth vortex. Hitting X milestone in X months, skyrocketing subscriber counts, raising loads of money in a matter of weeks—it all feels so heavy. Blocking out the noise and outside pressures and focusing on our own growth plan has been challenging but also very rewarding. It’s allowed us to hyper-focus on what’s really working for us—and what’s not—for our business, our brand, our customers, and most important, our pups.
What kind of feedback have you received from your customers, and have you (or will you) apply that feedback to how you sell your products in the future?
Sapp: We laid everything on the table from the get-go, from our ingredients to our sourcing to our manufacturing processes—a rarity, until recently, in the pet industry. Our customers are not only looking for a quality and effective product but an open line of communication to share their feedback. We’ve been able to take a lot of this feedback and quickly implement changes that directly impact our customers and their dogs. For example, we recently removed all meat products from one of our most popular supplements. This came as a direct result of current and potential customers indicating that their dogs were experiencing meat- or mixed-meat-related allergies and food sensitivities.
We were able to take this data, reformulate our supplement, and make it a more widely usable product for any pup, regardless of their allergy restrictions. We’re also constantly collecting new data through our custom quiz, really keeping our finger on the pulse of new and emerging issues that dogs and their owners are facing. Our dedication to data collection and leveraging that data to inform our decisions has been a huge part of Goodboy from inception and will continue to be as we grow.
Lewinger: We thrive on customer feedback to inform many of our business decisions. I think one that sticks out for me recently is the effort to continually improve the sustainability of products, especially for consumer packaged goods companies. We’ve already moved to smaller packaging for our renewal orders in order to cut down on unnecessary use of cardboard, and we’re currently developing more environmentally friendly containers and refill packs to cut down on our carbon footprint. We’ve seen this sentiment echoed by many of our customers and look forward to meeting the ongoing challenges of sustainability in the months and years to come.
Obviously, amid the coronavirus pandemic, consumers’ purchasing habits, practices, and even their relationship to food is going to change. How does Goodboy plan to adjust and fit into whatever this new normal might be?
Sapp: We’ve always tried to be a company and brand that provides real value for our customers and, most important, their pets. I think as we come out of this, consumers will be more in tune with what they are buying, from who, and why. For us, our focus has always been based on transparency and community, allowing our customers to be flexible within our model. Did you lose your job during the pandemic? We can put your account on hold. Love the products but need a break from the monthly payments? We can skip your next shipment. Your dog’s needs have changed, and you want to reevaluate your subscription? Let’s swap products and find something that fits those concerns better.
Where we do adjust is through our conversations and brand voice, providing more valuable information and knowledge on our products, as well as educating our current and potential new customers why supplemental care is important, now more than ever. As we all figure out our “new normal,” we know that the consumer purchasing process will certainly be more complex, making it our responsibility to uniquely meet these needs as best we can.
Lewinger: People are spending more time at home with their pets than they ever have. Their dogs are now right there with them during Monday morning conference meetings or after-work Zoom happy hours. So now more than ever, people are more closely in tune with some of their dogs’ needs, and more aware of some of their behaviors that they may have otherwise missed, which has created an opportunity for us to have these conversations with our subscribers. We’ve been able to adjust our messaging to focus more on the changing stay-at-home environment to try and help.
At the same time, how does a shutdown of this nature affect the future of the business, from product development to raising capital?
Sapp: Like many others, we are seeing some slowdowns within our supply chain. This doesn’t necessarily affect how we are developing new products, but it will impact and potentially extend the timeline in which we can release them.
In terms of raising capital, we’ve had to adjust. With the shutdown and instability of the market as of late, our focus has shifted from primarily angel investors to now more venture capital.
Looking beyond the post-pandemic era, which could be anywhere from a year to a few years from now, how do you plan to grow Goodboy, and what do you want the business to look like five years from now?
Sapp: We want to be the brand that redefines how modern “pawrents” proactively care for their pets. We’ll do this by constantly improving our technology, research, and data collection, using this data to meet the needs of our customers, future customers, and their pets. We’ll continue to expand our product offerings, making it easy, convenient, and fun to care for your best bud.
Lewinger: Our goal is to become the go-to brand for pet health and wellness. In the near future that means to continue expanding our supplement line to accommodate the growing number of needs we’re seeing in our dog community. In the future, that means addressing all aspects of health and wellness—physical and lifestyle wellness—which would include more broad initiatives like nutrition, exercise, and other accessory products. All with the ultimate goal of making a brand focused on creating happier and healthier pups.
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