Aug. 26, 2022

Building a Multimillion-Dollar Marshmallow Snack Brand

How CEO Mike Tierney created Stuffed Puffs & defied expectations


We’re kicking off a new bonus series called CEO Shorts! Nora chats with marshmallow entrepreneur Mike Tierney, founder and CEO of Stuffed Puffs, fluffy vanilla marshmallows filled with chocolate. Mike spent his early career working in the kitchens of restaurants including The French Laundry and Eleven Madison, and has since gone on to launch two brands over the last six years. Stuffed Puffs are currently sold in 33,000 retail locations nationwide. For more info on our presenting sponsor, check out realvision.com/businesscasual

 

Host: Nora Ali

Producers: Bella Hutchins, Olivia Meade   

Video Editor: Sebastian Vega

Production, Mixing & Sound Design: Daniel Markus

Music: Daniel Markus & Breakmaster Cylinder

Fact Checker: Kate Brandt 

Senior Producer: Katherine Milsop

VP, Head of Multimedia: Sarah Singer 

 

Full transcripts for all Business Casual episodes available at https://businesscasual.fm

Transcript

Nora Ali: From Morning Brew, this is Business Casual, bringing you conversations with people you know and some you may not know yet, to make business less intimidating. Because money talks, but it does not have to be dull. I'm your host, Nora Ali. Now, let's get down to business.

Hey, BC listeners. We are kicking off a new series called CEO Shorts, where we bring you bonus conversations with the founders and CEOs of some of the most fun and innovative companies out there today. First up, we have a marshmallow entrepreneur. Mike Tierney is the CEO of Stuffed Puffs, fluffy vanilla marshmallows that have been filled with delicious confections like milk chocolate. It's sort of like a handheld s'more that you can enjoy anywhere. Mike began his career working in the kitchens of restaurants including The French Laundry and Eleven Madison, and has since gone on to launch two brands over the last six years. Stuffed Puffs are currently sold in 33,000 retail locations nationwide, including Walmart and Target. Our chat with Mike Tierney is next, after the break.

Mike Tierney: Hey, Nora. How are you?

Nora Ali: I'm so good. How are you doing?

Mike Tierney: I'm great. Thanks for having me.

Nora Ali: Yeah, of course. I mean, who doesn't love marshmallows? This is going to be a really fun little lightning round Q&A with you and Business Casual. If you don't mind, I'd like to start with a little icebreaker. I know you've worked in different kinds of office settings. Whether it's restaurant kitchens, traditional offices, what is your biggest workplace pet peeve, if you have one? It could be from the culinary world or the corporate office world.

Mike Tierney: I think they cross over well. Disorganization. One thing that you learn really quickly working in three-Michelin-star fine dining is that everything has a place and everything needs to be clean, and that is a rude awakening for the manufacturing world. I think I turn people on their head a little bit with that, but I think it serves us well.

Nora Ali: Yeah, it helps set you apart. You're more organized than others around you, perhaps.

Mike Tierney: Exactly.

Nora Ali: Mike, how would you describe Stuffed Puffs, for those who haven't come across them yet?

Mike Tierney: It's a marshmallow that already has the milk chocolate on the inside. When you roast it for a s'more or you make one in the microwave, it melts from the inside out.

Nora Ali: It is a genius idea, and the website says, "We know no one was asking for a better s’more, a chocolatier hot chocolate or a tastier sweet snack." So if no one was really asking for this, except maybe you, in your personal experience, how did you pitch this idea in the first place?

Mike Tierney: No one may have been asking for it, but what we heard so frequently when we first launched was "You stole my idea," and I'm like, "Yeah, I get that," and that's honestly the highest form of flattery, is like, oh, you understood what we were doing immediately. That means we were doing something right. We didn't have to spend all this time educating someone to buy something that they didn't see a need for, and so pitching it to retail was very similar. You'd show it to the retail partners, and they'd go, "Why hasn't someone done this before?" and you're like, "I know. Exactly. That's why we're here."

Nora Ali: That must be very validating, as you pointed out, but there was a reason why other people hadn't done it before. In fact, one leading candy executive had told you that they tried doing this before. They said it was impossible. They spent millions trying to do it. What makes your approach different? How did you figure out how to properly stuff those marshmallows?

Mike Tierney: Actually, a lot of people told me that. Though we launched at retail in 2019, I started this business in 2012, and those first seven years, the stuff you can't see under the iceberg was all trying to reinvent something that everyone said couldn't be done. I think the benefit for me was I had no commercial, big-scale manufacturing background, so I didn't know that things had to be done a certain way. And coming from the fine dining world where the food that you're making is so far past what you can buy in a grocery store from a technology, from a process standpoint, from a creativity standpoint, so I looked at this and I was like, if I can do it by hand, there's got to be a way to do this commercially.

When I went to build this commercially, I mean, I started at Home Depot. I was like, "All right, I'm just going to buy a couple things and make a hand-cranked version and then start to automate it and then find the right commercial partners to build us some full scale-size equipment." I think the beauty of it was I wasn't constrained by knowing too much. I came into this with like a white sheet of paper, and I'm like, "There's no rules. We can break anything." I think that's how we overcame the problems everyone else saw.

Nora Ali: Yeah. We've been hearing that more and more, where, if you come in as a "outsider" or someone who doesn't have preconceived notions, that allows you to try things that other people might not try. That seems like it worked out for you, but Stuffed Puffs isn't your first foray into the consumer packaged goods space. You also started Mikey's, which, I was looking through the website, looks great for someone like me who has a lot of dietary restrictions. What did you learn from the experience of building Mikey's?

Mike Tierney: It's an interesting dichotomy. On one side, we're like a very clean label, very healthy, nutritionally focused, and then Stuffed Puffs is unapologetically indulgent. We just want you to have fun, have a good treat, treat yourself to a great piece of candy, but I learned so much from doing the Mikey's business, and business is still growing, because I did everything by myself for the first few years. I was the accountant. I was the graphic designer. I was our social media coordinator. I did our supply chain and et cetera, et cetera, et cetera.

When you get to touch every facet of the business as it goes from zero to, let's say, $5 million, $6 million a year in sales, that's just about the point we brought in private equity, and then we went and built Stuffed Puffs from zero to a $70-plus-million company this year in sales in two years, and now we're about 200 team members. You're just dangerous enough to bother everyone, as I think I've been told too often, but it also gives you great context because, in my role now, you're like air traffic control. You're not doing every little thing. You're supervising everything. To be able to pivot from one discipline to another, from accounting to creative to engineering to supply chain, that is a really helpful skill set, so I'd advise anyone to make sure that they touch every part of it so that you know what's going on, and you're not hiring people who can pull wool over your eyes.

Nora Ali: Yep. Yep, you know the questions that you need to ask, at least, even if you don't have the answers.

Mike Tierney: Exactly. Yeah.

Nora Ali: I have to say the Mikey's story video on the website is one of the best about-us videos I've ever seen. It's really great storytelling, honestly. How important is storytelling when you're trying to grow a brand, whether it was Mikey's or with Stuffed Puffs?

Mike Tierney: I think it's a huge part of it. I think, especially, how media's changed and how we as consumers consume media. I'm a consumer, too. A lot's changed in the last 10 years, 15 years, 20 years. There was a time where Gillette could do The Best a Man Can Get and they can ride that campaign for 20 years and just pour money into it, and it works. I think we're in a space now where consumption of media is so high that people have become numbed to brand advertising. I mean, you think you've seen it with the transition of people from Facebook to Instagram and then from Instagram to TikTok, and then, as people start to advertise on TikTok, I think we'll see another platform jump up and drive it. I think being a brand that has a personality that has the ability to talk to its consumers like a person instead of just a brand is really important today.

Nora Ali: Yeah, and I would love to hear some specifics around that with Stuffed Puffs, because the branding is very s'mores-focused, as you might imagine, and that is a summer, it's a seasonal treat, generally. What has been the most successful when it comes to branding and strategy when you are trying to sell it all year round and not just for our summer parties?

Mike Tierney: I think it's two parts. One is communication in the store. We spend a lot of focus on point-of-sales materials, talking about hot chocolate, whether it's on header cards or it's on hang tags or other types of POS material, but then it's also in our media. We push recipes pretty heavily. We want you to see all the different ways you can bring Stuffed Puffs into your kitchen.

We've got two ends of the portfolio now. So on our lay-down pillow bags, our classic milk chocolate, chocolate on chocolate, cookies and cream, it's all about being an ingredient in something you do. A marshmallow is an ingredient in a s'more just as much as an ingredient in a hot chocolate or rice crispy treat or some of the other fun things we make, and then on Big Bites, the idea is instant consumption. You don't want to make a s'more? Great. We've made one for you, and you can just rifle them down out of the bag. A lot of it is communicating what the product is and what our usage is, but, like Mikey's, we've had a lot of fun with it, too. I don't know if you've seen our TikTok lately, but I've been running around with a flamethrower making giant marshmallows, and it's a lot of fun.

Nora Ali: What? I didn't know that. That's amazing.

Mike Tierney: Yeah. Yeah. You gotta get on that.

Nora Ali: I'll have to check it out. That's awesome. You did say in an article with Food Business News last year, "To me, this isn't just about s'mores. This is a technology platform." What does that mean exactly with Stuffed Puffs? What is the innovation when it comes to stuffed marshmallows and beyond?

Mike Tierney: I think there's a lot of places that Stuffed Puffs as a company can go, maybe not necessarily as a brand. Stuffed Puffs, as a brand, it's all about that indulgent treat-yourself experience, very confectionery focused, but there's a world parallel to that where we can do low-sugar chocolate, low-sugar marshmallow, and make an all-natural version for the Whole Foods, Sprouts of the world. If THC, CBD ever flips legal, Puff Puff Puffs is not far out of reach, where your character will have bloodshot eyes—that'll be a lot of fun.

Then, even in the nutraceutical space, as you've seen nutraceutical gummies expand so prolifically over the last couple of years, they can only handle water-soluble vitamins and nutrients. We have a platform that would give you the ability to do the complete spectrum, because we've got fat-based system, chocolate inside of a marshmallow. There's all sorts of things we can continue to innovate on beyond just the Stuffed Puffs brand with the technology that we developed.

Nora Ali: I cannot wait for Puff Puff Puffs. That sounds so good. That's an amazing name.

Mike Tierney: There's a couple of regulatory hurdles to get through, but—

Nora Ali: Yeah, just a couple.

Mike Tierney: One of these days, we'll see those out there.

Nora Ali: Well, Mike, do you have any advice for aspiring entrepreneurs who are looking to enter the food and snack space, whether it's broad advice or advice on how to get distribution? Because that was a huge thing for you guys, getting into Walmarts and Targets, now sold in over 33,000 retail locations. What's your best advice for those who are just starting out and trying to get as big as Stuffed Puffs?

Mike Tierney: I think there are a couple of things. I mean, I think you have to make sure that you pressure-test your idea. We made sure with Stuffed Puffs that we had a pretty defensible moat in the marketplace. If you've noticed, no one's been able to knock us off yet. That's a nice moat to have. That gives you some white space to run and grow, and then I think the best advice I could give anyone is, however much money you think you need to start a business, just times it by 10, because you're wrong. Whatever it is, you're going to need more capital than you think you need, and it's really important you find great partners to support that journey who are aligned with the vision, see where you want to go, and want to support that growth, because, when you're playing in a space with corporate giants, Coca-Cola, Pepsi, Frito-Lay, et cetera, et cetera, it's not an inexpensive game.

Nora Ali: Absolutely. Great advice there. Okay, Mike, before we let you go, we have a special bonus segment called Shoot Your Shot. We want to know, what is your moonshot idea? This is your wildest ambition, your biggest dream. It could be company related, personal related. It could be Puff Puff Puffs. What's your moonshot? Shoot your shot.

Mike Tierney: Yeah, Puff Puff Puffs is a cool one. I don't know. I mean, Stuffed Puffs itself has been my moonshot. I've been working on this thing for 10 years, and we're still going, and the first seven of them were some dark times. I mean, I think I'm living on my moonshot as we speak.

Nora Ali: You're not tired of marshmallows at this point?

Mike Tierney: No. I mean, I eat marshmallows every day. We do a tasting every morning. It's amazing I'm not 500 pounds.

Nora Ali: What's your favorite way to consume marshmallows?

Mike Tierney: I think the best way to eat a Stuffed Puff is a microwave s'more. You put one on a graham cracker. Seven seconds. It doesn't matter if it's snowing outside, sunny outside, you've got this less than 50-cent treat that is just delicious. Most marshmallows blow up in the microwave and, if you put a block of chocolate in there, it gets hard and gross. Ours? It wasn't even by design, it was almost by accident, but they just melt so nicely. The chocolate melts and it's stays within the graham cracker. It's just a perfect, perfect treat in less than 10 seconds.

Nora Ali: I've always been on team microwave s'mores over campfire s'mores, and it sounds like you agree. Microwave—

Mike Tierney: Yeah, microwave got a bad rap somehow, but it's a great product.

Nora Ali: I know. Well, Mike, thank you so much for joining us for this lightning round on Business Casual. We appreciate it.

Mike Tierney: Awesome. Thanks for having me, Nora.

Nora Ali: This is Business Casual, and I'm Nora Ali. You can follow me on Twitter @NoraKAli, and I would love to hear from you. If you have ideas for episodes, comments, thoughts on episodes you loved, even fun segment ideas, feel free to shoot via DM, and I will do my very best to respond. You can also reach the BC team by emailing businesscasual@morningbrew.com, or call us. That number is 862-295-1135. If you haven't already, be sure to subscribe to Business Casual on Spotify, Apple Podcasts, wherever you listen, and if you like the show, please leave us a rating and a review. It really, really helps us. Business Casual is produced by Katherine Milsop and Bella Hutchins, with special production help on this episode from Olivia Meade. Additional production, sound design and mixing by Daniel Markus. Kate Brandt is our fact checker. Sarah Singer is our VP of multimedia. Music in this episode from Daniel Markus and The Mysterious Breakmaster Cylinder.

Thanks for listening to Business Casual. I'm Nora Ali. Keep it business, and keep it casual.