Aloha has undergone a reincarnation under former ice hockey player and CEO Brad Charron, who has built up a circa $100m protein business based on bars, powders and coconut-centric drinks.

Operating out of the US state of Colorado, B-Corp-certified Aloha is content focusing on the domestic market for the time being, where it is enjoying "high, double-digit growth" and a $68m recent investment from SemCap Food and Nutrition.

With a new listing with Target stores in the bag to complement distribution with Walmart, Kroger, Whole Foods Market, Costco and Sprouts, Charron talks through the challenges and plans ahead with Just Food’s Simon Harvey.

Simon Harvey (SH): What is the history of the company?

Brad Charron (BC): The company was founded in its first identity in 2013. It did a great job of raising money. It was set up as a food-tech company driven by influencers and advocates, with a broad health mission and lofty goals. They launched it with about nine or ten different product categories and they built a business to a maximum size of $9m. It was a colossal failure.

Enter me in 2017. The company went bankrupt and a couple of angel investors and I took the assets. I fired everyone, I got rid of our expensive offices, I got rid of every product and started again.

I came back with protein bars and protein powders, which is something I’d known because I'd worked in the broader food business before at Chobani and Nature's Bounty. I wanted to build a better food company but it needed to be done through a couple of sticks of dynamite.

SH: Was the SemCap funding the first since your reincarnation?

BC: I raised three rounds. I recapitalised the company, I paid off $4m-plus of venture debt, we had two lawsuits against us and a bunch of creditors and I got rid of all that. I started clean, in effect.

We did two smaller rounds with the existing investor group, all angels in 2018 and 2020, which provided working capital for the business. Then we stopped. The company has been profitable for over four years now, EBITDA profitable and free cash flow positive.

The SemCap deal was an opportunity to underscore our mission and our operating philosophy with people that really knew the food business. It allowed my angels to get eight or nine times their money and it allowed me to bring in a good partner who would be there for the second side of our growth story.

SH: Are you the majority shareholder?

BC: I was never the majority shareholder. I've always been a very significant shareholder. I didn't have ten million dollars sitting in the kitty to recapitalise the business.

Two things were really important to me. One was all employees will be shareholders. The second, it's a flat cap table that says, when we win, we win, when we lose, we lose. I was an ice hockey player growing up for a number of years, played in some pretty high levels, and that team mentality has always been very important to me.

SH: Is that from where the protein idea originated?

BC: I love the nutrition aspect of it. From a very young age, I was taught about food and sleep and diet and so forth. I worked in Under Armor, the athletic company. I got to work with a lot of high-profile athletes and I saw first-hand the role of food and diet in their regimen.

You have to have a great macro-nutrient story to be a healthy food, to be in the wellness side. You have to have third-party identifiers that tell the consumer that you're good and you're trustworthy – for us, that’s USDA organic. You have to be well-priced.

SH: How does Aloha look to stand out from the crowd?

BC: You're not wrong. It's a crowded and cluttered category. It's also a very large category. The total addressable market on protein bars, just in the US alone, is $12bn and growing. Drinks and powders, $4-5bn and growing

These are useful categories for a number of consumers. Whether you're a heavy user that uses it every day, or whether you're a light user that uses a protein bar on the go.

If you're going to fight against the big CPG companies, you're going to fight against all the scale and so forth, there has to be a total addressable market you can actually win some size on.

Powders and drinks are harder to differentiate. Powders is largely around ingredients, a lot of brands that make a lot of claims. We don't. We focus on real food ingredients and so forth. People who are discerning and ingredient readers and knowledgeable understand it's a really good product.

SH: Have you had any takeover interest?

BC: We're on everyone's radar. You don't get to be $100m-plus revenue, on the trajectory that we are in measured channels, without people going, 'I wonder what’s up with Aloha?'

Two-thirds of our business is digital and that's not trackable for these big CPG companies. They don't have the Amazon numbers, they don't know how strong we are in direct-to-consumer.

I think the CPG companies would like to do bigger deals. That's been the M&A market of the last number of years and so I think we've been a little small. I'm sure that we're on their radar but there's no conversations ongoing about someone taking us out right now. We're pretty happy where we are.

SH: Is D2C generating most of your sales?

BC: It’s about a quarter. Once I thought we had something really meaningful that would be better in macro-nutrients, better in certifications, better in terms of brand value, and that goes for everything from packaging to B-Corp, which we became in 2021, taste and texture, I thoughtfully rolled it out to retail partners in the US.

SH: Out of Aloha’s products, what brings in the most money?

BC: It’s bars. That's the largest by far, that's our area of focus. Drinks and powders are fantastic. They round out our category. We only sell those in digital channels where I think the consumer can be more thoughtful about understanding the value proposition.

Some will use our product for a healthy lifestyle, a meal replacement, a diet or on the go. Some will use it for training. We sell to a lot of professional league football and hockey teams.

SH: Who is your biggest competitor on the drinks side?

BC: Drinks are such a small part of our business. Owyn would be a competitor of ours, Quest has drinks, Fairlife owned by Coca-Cola. I don't think anyone is organic, I don't think anyone is truly plant-based. I don't think anyone has the kind of macro-nutrient profile we have.

SH: What are your growth rates as a $100m business?

BC: It's not unheard of for us to grow high-high, double digits in revenue and we're growing triple digits from a percentage basis on EBITDA. It's balanced growth. Both retail and digital are growing nicely.

I could have put more gas in the fire to grow faster but I didn't think that was the right thing to do for the company.

I could have done more. I could have put more gas in the fire to grow faster but I didn't think that was the right thing to do for the company. I'm quite comfortable following the slower, patient, sustainable, thoughtful growth plan because I think it's financially responsible for the business.

SH: Do you have any longer-term targets or aspirations?

BC: It's about doing the yeoman's work to build a holistically good business, good product, good culture, good brand, good commercial enterprise, good financials.
We're in big categories. I know how big Kind and Clif Bar are. We are still small compared to them but there's no limits to what our brand could be.

SH: Have you got distribution plans beyond the US?

BC: There's still so much to do here in the US and you can extend it to Canada, too, but we're doubling down on key markets with expanded retail presences. We're intentionally not going to other markets. That doesn't mean I don't believe that Aloha, the product or the brand could resonate.

SH: Are you going through the same cycle as other food companies – rebuilding volumes after taking price?

BC: Fortunately, no. We have not seen any decline in our velocity, our volume metrics. We have very heavy repeat rates versus competition.

In Amazon data, we're more than 20 percentage points higher than some of our competition and repeat rates, which tells me that when people find the brand and the product, they adopt it.

We've only done one price increase in my whole history here at the company. That was a number of years ago.

Who knows what's going to happen with the tariff threats here in the US, with the political system. We try to see around corners from a commodity standpoint. We try to make smart bets in terms of our financial structure. We're very thoughtful in terms of our manufacturing partnerships to try to make sure we have enough volume to supply the demand that we continue to see.

The consumer IQ on food has never been higher. I think that a company like us that is transparent, thoughtful, sustainable, runs a good value proposition business, we are well positioned to capture that innate curiosity from consumers in terms of 'is there something better?'