This is an installment of Startup Year One, a special series of interviews with founders about the major lessons they have learned in the immediate aftermath of their businesses’ first year of operation.
Three Wishes is a new kind of cereal: one that touts to be healthier but still tastes like a childhood indulgence. Advertised as high in protein, low in sugar, and gluten and grain-free, Three Wishes is meant for kids (and kids at heart) of all ages.
The startup launched in October 2019, just months before the pandemic broke out. But instead of focusing on delivering direct-to-consumers, the company doubled down on retailers—and saw huge payoff in the launch strategy. Three Wishes says it went “from zero to multi-millions in sales” in the last year thanks to national retail accounts like Sprouts, Whole Foods Market, and Wegmans. The brand plans to have its cereal boxes on the shelves of roughly 1,500 to 2,000 stores by the end of 2021.
Three Wishes also prides itself as the first female-founded brand in the cereal aisle, which the company says has been historically dominated by men. CEO Margaret Wishingrad is a mother of two (she gave birth to both her business and a child this year), and a daughter of immigrants.
Fortune recently spoke with cofounders Margaret and her husband, Ian, about what it’s like establishing and running a food startup.
The following interview has been condensed and lightly edited for clarity.
Fortune: Can you share a bit about your professional background prior to launching Three Wishes?
Ian: Prior to launching Three Wishes, I ran my own branding and advertising agency working on clients as large as AT&T, Diageo, and Nestle, to some of the most interesting startups. Margaret was the Chief of Staff. We’ve spent our whole lives coming up with big ideas for brands and always wanted to create one for ourselves.
What inspired you to launch Three Wishes?
Margaret: Our son, Ellis. When I became a mama for the first time, I was so picky about every single ingredient that I would feed my little one and when cereal was a recommendation for introductory finger foods I had my a-ha moment. There was no clean, truly better-for-you cereal on the market that I was excited to feed my son and also consume myself. If you can’t find it, make it.
Walking into most grocery stores anywhere in the U.S., there is no shortage of options in the cereal aisle. What makes Three Wishes different from the rest? What went into the research and development process for the chosen flavors and ingredients?
Margaret: Three Wishes is the only cereal on shelves that takes the best parts of cereal and subtracts the worst parts; it’s revolutionary for the aisle. We were able to take a product that is nutrient deficient and grain-based and turn it around. We created a grain-free, nutrient-dense, clean ingredient cereal without any compromise on taste. We worked tirelessly on being able to replicate the traditional grain-based cereal experience from the way it tastes to the way it soaks in milk, or even turns your milk a fun color.
We spent over two years developing the product to make sure that it reminds you of your childhood favorites. We offer cinnamon, honey, unsweetened, cocoa, fruity, and frosted flavors. We knew we landed on our final recipe and product when Ellis asked for more.
You launched Three Wishes just months before the pandemic? How did that upend your business plan? What kind of changes did you have to make, including along your supply chain and distribution models?
Margaret: We were lucky that we planned well, secured solid relationships with retailers, and were coincidentally prepared. A lot of our competitors focus on direct-to-consumer, but as an omnichannel brand dedicated to our retailers, it paid off in spades once cereal consumption exploded during the pandemic and supply chains were thrown.
We always planned to be an omni-channel brand with a heavy focus on brick and mortar, the pandemic made us quickly reassess our e-comm plans. In three weeks, we relaunched a newer website with a better shopping experience. We became available in grocery “e-tailers,” such as Amazon, Thrive, and Fresh Direct. Overnight the pandemic transformed consumers’ comfort with online grocery shopping. We immediately invested in platforms like Instacart and Amazon. As consumers ceased wandering in the aisles of supermarkets looking for new things, we had to get creative with how people would discover our brand and then look for it in store.
Looking forward, where do you want to see Three Wishes in five years?
Margaret: We’re investing a lot in reputation and trust from our customers. We’d love nothing more than to become a household brand, born of that trust. We are also working on innovating to be able to deliver new products filled with great ingredients, macros, and flavor.
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