Words of advice for food entrepreneurs: a discussion with an Indie Food Hub Co-Founder
We recently connected with Corey Hill, one of the co-founders of Indie Food Hub, for a Q&A about pressing questions facing food ventures, tips for success and a few watch-points for budding entrepreneurs.
Indie Food Hub is a resource center for small to medium sized food businesses, providing everything from delivery and distribution services, workshops, and online how-tos. We work with caterers, pop up chefs, bakers, and packaged good makers.
KIVA: What are the main challenges that food businesses face today and how can they be overcome?
COREY: Many small food businesses have problems with financing. We hear that a great deal of the time: “How do I find capital to get going, to buy equipment, to cover operating expenses?”
Figuring out which lender to approach, how to find investors - not a week goes by where someone doesn't ask about these things. I think it's always good to check in with organizations geared towards advising on these types of things, whether that's a small business administration, or forming a relationship with groups like Working Solutions.
Another problem small food businesses face is permitting. Navigating through the process to stay on the right side of the law can be tricky, and it eats up time. If possible, working through an incubator like San-Francisco-based La Cocina helps demystify this process, since you'll be able to have in-house help with all your questions. If not, a phone call with a city or county official can save a lot of time versus trying to figure out forms online, which are often out of date or not working.
KIVA: What are some common characteristics of successful food ventures? And of ventures that fail?
COREY: Successful food ventures share organization. It's important to have all the right systems in order to manage the business side of things, which many food folks lose sight of. They think, 'oh, I have a great product, and that's it. Everything will follow from that.’
But it doesn't work that way. You need to have your pricing in order. You need to pay your taxes on time. You need to make sure you don't carry too much debt. You need to have a plan to get your granola into Whole Foods. The folks who are doing well have put these thoughts in order ahead of time, and continue to think about them once they get rolling.
KIVA: What early investments should food entrepreneurs consider making?
COREY: In terms of early investments - I would say to think very carefully about the money you spend on commercial kitchen space. It's very important to understand the terms.
KIVA: If you could say one thing to new food business owners, what would it be?
COREY: I would consider a timely investment in web presence to be critically important. That's going to be the first stop for most people, and you don't need to break the bank anymore to get great web design, especially if you're not doing anything outside of the ordinary. But for people to be able to find you online, and contact you, will be vitally important as you start your food business.
KIVA: How can Kiva borrowers best use Indie Food Hub?
COREY: Kiva borrowers can use Indie Food Hub as a starting point to find the lay of the land for small food businesses. You can find inspiring articles, and searchable resources. You can also use Indie Food Hub as a resource for delivery and distribution, which is a major sore point for many food producers on the smaller side.
KIVA: Tell us about your experience using Kiva!
COREY: Kiva has been a great resource for Indie Food Hub. We first used a $5k loan to fund the development of a website and workshops for small food businesses. Throughout this process the Kiva staff was extremely helpful and encouraging. We found the hybrid format, which involves proving your credibility with the community, to be a fun way to raise much-needed capital.