WEBVTT - Hoboken Farms Nets $4 Million in Fresh Funding

0:00:02.520 --> 0:00:07.040
<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

0:00:08.200 --> 0:00:11.920
<v Speaker 2>You're listening to Bloomberg Business Week with Carol Masser and

0:00:12.000 --> 0:00:14.440
<v Speaker 2>tim Stenoveek on Bloomberg Radio.

0:00:15.000 --> 0:00:17.520
<v Speaker 1>According to the US Small Business Administration, the US is

0:00:17.560 --> 0:00:21.000
<v Speaker 1>more than thirty six million small businesses, and those businesses

0:00:21.040 --> 0:00:23.680
<v Speaker 1>provide close to forty six percent of employment in the

0:00:23.680 --> 0:00:26.320
<v Speaker 1>private sector. And our next guest knows a lot about that.

0:00:26.600 --> 0:00:28.520
<v Speaker 1>He is someone I have known for a long time.

0:00:28.800 --> 0:00:31.560
<v Speaker 1>Brad Finkel is CEO of Hoboken Farms. It's a family

0:00:31.600 --> 0:00:34.960
<v Speaker 1>owned company, started out in local farmers' markets and has

0:00:34.960 --> 0:00:37.200
<v Speaker 1>grown into a business that sells pasta and sauces all

0:00:37.240 --> 0:00:40.000
<v Speaker 1>over the country. And it's taken you. First of all, welcome,

0:00:41.479 --> 0:00:42.479
<v Speaker 1>it's great to have you here.

0:00:42.520 --> 0:00:43.479
<v Speaker 3>Birthday, Oh thank you.

0:00:44.720 --> 0:00:46.479
<v Speaker 1>But I have known you a long time and I

0:00:46.479 --> 0:00:49.479
<v Speaker 1>want to get into how you've gone from farmers' markets

0:00:49.800 --> 0:00:52.040
<v Speaker 1>to so much more. But I want to also ask

0:00:52.080 --> 0:00:54.400
<v Speaker 1>you because you guys, I've been to your you know,

0:00:54.520 --> 0:00:56.640
<v Speaker 1>bought from your different stands.

0:00:56.320 --> 0:00:57.840
<v Speaker 3>In Southton Park, Jersey City.

0:00:57.920 --> 0:01:00.320
<v Speaker 1>I have, I have, I have, And so you guys

0:01:00.320 --> 0:01:03.200
<v Speaker 1>have people out in front talking with consumers all the time.

0:01:03.480 --> 0:01:05.160
<v Speaker 1>How would you say the consumers doing right.

0:01:05.080 --> 0:01:07.959
<v Speaker 3>Now, I think the consumer is scared. I think the

0:01:08.000 --> 0:01:10.760
<v Speaker 3>consumer is confused. I think the consumer is trying to

0:01:10.800 --> 0:01:17.000
<v Speaker 3>grab on to some form of an idea of what

0:01:17.040 --> 0:01:19.720
<v Speaker 3>they can plan for, and they can't find it, so.

0:01:19.720 --> 0:01:21.920
<v Speaker 1>Being more discretionary and spending. Do you see that?

0:01:22.280 --> 0:01:29.080
<v Speaker 3>I Well, in my exact world, I find consumers are

0:01:29.120 --> 0:01:31.840
<v Speaker 3>not going out to eat to restaurants as much. They

0:01:31.920 --> 0:01:34.880
<v Speaker 3>are cooking at home. So they're coming to us, but

0:01:34.959 --> 0:01:38.959
<v Speaker 3>they certainly want unbelievably high quality, and they also want

0:01:39.040 --> 0:01:39.880
<v Speaker 3>value for their money.

0:01:40.319 --> 0:01:40.520
<v Speaker 1>You know.

0:01:40.640 --> 0:01:44.080
<v Speaker 2>I see that too. People aren't ordering food as much

0:01:44.240 --> 0:01:45.840
<v Speaker 2>here in New York City. They're not getting delivery as

0:01:45.880 --> 0:01:46.120
<v Speaker 2>much of.

0:01:46.120 --> 0:01:47.319
<v Speaker 1>The We're definitely not doing that.

0:01:47.360 --> 0:01:49.160
<v Speaker 2>I've talked to some folks about this for a couple

0:01:49.200 --> 0:01:51.840
<v Speaker 2>of reasons. One, the prices have with all the fees

0:01:51.840 --> 0:01:54.320
<v Speaker 2>added on the crazy incredibly high. So yeah, I think

0:01:54.360 --> 0:01:57.160
<v Speaker 2>people are cooking more at home. Is this a different

0:01:57.240 --> 0:01:59.120
<v Speaker 2>How is this moment different from other moments that you've

0:01:59.120 --> 0:02:00.960
<v Speaker 2>sort of experienced being in this space. I know that

0:02:01.640 --> 0:02:03.680
<v Speaker 2>your business has grown a lot in recent years, but

0:02:04.040 --> 0:02:05.680
<v Speaker 2>you've had a good eye on the consumer for quite

0:02:05.720 --> 0:02:06.160
<v Speaker 2>a long time.

0:02:06.240 --> 0:02:09.119
<v Speaker 3>You know. I started my business in nineteen ninety two.

0:02:09.720 --> 0:02:13.000
<v Speaker 3>We participate in up to eight hundred farm markets a year.

0:02:13.240 --> 0:02:17.600
<v Speaker 3>That's outdoors, underneath tents, on the street, face to face

0:02:18.280 --> 0:02:23.799
<v Speaker 3>with our consumers in two thousand and one. You know,

0:02:23.919 --> 0:02:26.640
<v Speaker 3>we were there during nine to eleven. Then during the

0:02:26.680 --> 0:02:31.240
<v Speaker 3>recession we went through that. This feels kind of like

0:02:31.280 --> 0:02:35.639
<v Speaker 3>a combination of both, not just confusion, but fear.

0:02:36.120 --> 0:02:38.399
<v Speaker 2>This is such a different message than we're getting from

0:02:38.800 --> 0:02:40.160
<v Speaker 2>the executives of big companies.

0:02:40.240 --> 0:02:42.520
<v Speaker 1>Yeah, who seem to be still a beat about a

0:02:42.520 --> 0:02:43.120
<v Speaker 1>lot of things.

0:02:43.160 --> 0:02:46.440
<v Speaker 3>Well, I mean, if you're an investor, that's great, But

0:02:46.720 --> 0:02:49.400
<v Speaker 3>if you're trying to feed your family and you're not

0:02:49.440 --> 0:02:51.639
<v Speaker 3>going to restaurants anymore, and you're going to supermarkets, and

0:02:51.680 --> 0:02:54.720
<v Speaker 3>if not supermarkets, farm markets, Brad. You know, it's so.

0:02:54.720 --> 0:02:56.760
<v Speaker 1>Interesting because I think about some of the things that

0:02:56.760 --> 0:02:59.079
<v Speaker 1>we spend headlines talking about today's day, where we talked

0:02:59.080 --> 0:03:00.359
<v Speaker 1>a lot about the Federal Reserve. I'm not going to

0:03:00.400 --> 0:03:01.240
<v Speaker 1>ask for your view on that.

0:03:01.200 --> 0:03:02.440
<v Speaker 3>But it's just one of the Kevins.

0:03:03.760 --> 0:03:07.560
<v Speaker 1>Nice well done, But this is why I've loved talking

0:03:07.600 --> 0:03:09.000
<v Speaker 1>to you over the years. You've also been a real

0:03:09.120 --> 0:03:13.440
<v Speaker 1>estate investor, you've sold businesses, but it's it's what really

0:03:13.520 --> 0:03:16.160
<v Speaker 1>matters when it comes to small businesses. Is it changes

0:03:16.160 --> 0:03:18.640
<v Speaker 1>in the administration? Is it any of that stuff?

0:03:19.440 --> 0:03:21.000
<v Speaker 3>Far be it for me to be able to say

0:03:21.000 --> 0:03:26.600
<v Speaker 3>what matters. What matters to me is stability. If I'm

0:03:26.639 --> 0:03:30.240
<v Speaker 3>going to plan for next month, next year, I have

0:03:30.320 --> 0:03:32.080
<v Speaker 3>to be able to have an understanding of what it

0:03:32.120 --> 0:03:35.320
<v Speaker 3>is I'm planning for. I mean, for instance, our pasta

0:03:35.360 --> 0:03:39.880
<v Speaker 3>sauce is you know, popping up on shelves across the

0:03:39.920 --> 0:03:45.360
<v Speaker 3>supermarkets of America. Tariffs hit our ingredients, our cogs go up.

0:03:45.520 --> 0:03:48.640
<v Speaker 3>What do you do about that? So its a small business,

0:03:48.680 --> 0:03:51.960
<v Speaker 3>you know, it is something that hits our pocketbook. Last night,

0:03:52.000 --> 0:03:56.320
<v Speaker 3>I just read a posting from a really well known

0:03:56.320 --> 0:03:58.880
<v Speaker 3>restaurant that is closing its doors, and it was really like,

0:03:59.040 --> 0:04:08.160
<v Speaker 3>I cannot do this anymore. Is just a horrendous place

0:04:08.360 --> 0:04:10.360
<v Speaker 3>in the country to be able to do? You know,

0:04:10.680 --> 0:04:11.040
<v Speaker 3>we still have.

0:04:11.160 --> 0:04:13.080
<v Speaker 1>During COVID, we were shocked by how many, even like

0:04:13.200 --> 0:04:17.159
<v Speaker 1>very well known chefs and restauranteurs who were struggling and

0:04:17.200 --> 0:04:19.480
<v Speaker 1>we thought they would be good. We want to get

0:04:19.480 --> 0:04:21.880
<v Speaker 1>to your story because farmer's market is where you began.

0:04:22.120 --> 0:04:24.279
<v Speaker 1>You have tons of farmers' markets and you're doing it

0:04:24.320 --> 0:04:26.760
<v Speaker 1>in crazy weather and even this weekend in the cold.

0:04:27.400 --> 0:04:31.560
<v Speaker 1>How do you get to where you've got multiple brand

0:04:31.600 --> 0:04:34.880
<v Speaker 1>not brands, but jars of sauces, different things, and you've

0:04:34.880 --> 0:04:37.560
<v Speaker 1>become a much bigger business. You're in a ton of

0:04:37.600 --> 0:04:40.559
<v Speaker 1>stores around the country. And tell me if I'm wrong,

0:04:40.600 --> 0:04:43.040
<v Speaker 1>because my daughter said, I think I bought them in London.

0:04:43.920 --> 0:04:46.040
<v Speaker 3>There we do have a couple of places in London

0:04:46.040 --> 0:04:48.839
<v Speaker 3>that you can buy it at a small, smaller independent.

0:04:48.920 --> 0:04:52.239
<v Speaker 3>In fact, yeah, we've just got an order from Ireland

0:04:52.279 --> 0:04:55.159
<v Speaker 3>today and the tiriffs affected. Now all of a sudden,

0:04:55.200 --> 0:04:57.040
<v Speaker 3>there's a lot more hoops that we have to come through.

0:04:58.200 --> 0:05:02.960
<v Speaker 3>So I was a teenager living in Hoboken, New Jersey,

0:05:03.120 --> 0:05:08.200
<v Speaker 3>playing bass in a band in a van, touring from

0:05:08.880 --> 0:05:14.479
<v Speaker 3>Hoboken to Maine, down to Virginia to Memphis to Nashville

0:05:14.480 --> 0:05:17.520
<v Speaker 3>into Austin, Texas. And as you could imagine, that is

0:05:17.680 --> 0:05:23.040
<v Speaker 3>not a great plan for financial stability. So I was

0:05:23.080 --> 0:05:26.240
<v Speaker 3>going to Ramapo College in Mahwah, New Jersey, up Route seventeen,

0:05:26.560 --> 0:05:29.400
<v Speaker 3>and I would meet these nice kids who weren't from Hoboken,

0:05:29.400 --> 0:05:30.920
<v Speaker 3>and they would say, would you like to come over

0:05:30.960 --> 0:05:32.360
<v Speaker 3>from my house? And I said yes, and then I

0:05:32.400 --> 0:05:34.720
<v Speaker 3>would get a phone call, Hey, my mother wants to know,

0:05:34.839 --> 0:05:37.559
<v Speaker 3>could you bring some once at all? Sure, my father

0:05:37.600 --> 0:05:40.080
<v Speaker 3>wants to know, could you bring a baguette? Some baguettes

0:05:40.080 --> 0:05:43.919
<v Speaker 3>from Dom's Bakery at six and grand absolutely. And this

0:05:44.080 --> 0:05:47.040
<v Speaker 3>kept on happening, and I said to my grandmother, do

0:05:47.080 --> 0:05:50.039
<v Speaker 3>they not have breading shees where they live? But what

0:05:50.200 --> 0:05:53.200
<v Speaker 3>it was in my sociology class that I heard about

0:05:53.600 --> 0:05:56.880
<v Speaker 3>was the gentrification in Hoboken had started. These were ex

0:05:56.920 --> 0:05:59.600
<v Speaker 3>Hoboken ice who had moved to the suburbs. And I

0:05:59.720 --> 0:06:02.640
<v Speaker 3>started did a home delivery service. Literally, if you called

0:06:02.640 --> 0:06:06.360
<v Speaker 3>me and left the message on my old cassette answering

0:06:06.400 --> 0:06:09.719
<v Speaker 3>machine on Monday, I delivered to you on Tuesday. If

0:06:09.760 --> 0:06:12.080
<v Speaker 3>you called on Thursday, I delivered to you on Friday.

0:06:12.279 --> 0:06:14.640
<v Speaker 3>And I ended up with a couple of hundred customers.

0:06:14.920 --> 0:06:17.280
<v Speaker 3>One of those customers was a gentleman named Peter Baronio.

0:06:17.320 --> 0:06:21.159
<v Speaker 3>Peter Baronio became the economic development director for Anglewood, New Jersey,

0:06:21.160 --> 0:06:22.760
<v Speaker 3>called me up and said, we're having a farm market.

0:06:22.800 --> 0:06:25.159
<v Speaker 3>Would you like to come? I said, what's a farm market?

0:06:25.680 --> 0:06:28.479
<v Speaker 3>And he said, I don't know, but we're having one.

0:06:29.440 --> 0:06:30.960
<v Speaker 1>So crazy because they're everywhere.

0:06:31.000 --> 0:06:33.400
<v Speaker 3>Now, well now they are. But yeah, kind of started

0:06:33.440 --> 0:06:38.000
<v Speaker 3>as a side hustle. I made a marinara sauce, and

0:06:38.120 --> 0:06:42.120
<v Speaker 3>that marinara sauce really took off. Now that's kind of

0:06:42.120 --> 0:06:46.280
<v Speaker 3>the short story. People would stand downline and buy it.

0:06:46.440 --> 0:06:51.279
<v Speaker 3>By the case. A very important buyer from Whole Food

0:06:51.360 --> 0:06:55.040
<v Speaker 3>saw that line of people tried our sauce and called

0:06:55.080 --> 0:06:57.000
<v Speaker 3>me up on a cell phone and said, we'd love

0:06:57.040 --> 0:06:58.960
<v Speaker 3>to have you in our stores. And I said which one.

0:06:59.000 --> 0:07:00.960
<v Speaker 3>They said, all of them across the Northeast. So that

0:07:01.200 --> 0:07:06.200
<v Speaker 3>started my journey from farm markets to supermarkets across America.

0:07:06.320 --> 0:07:08.799
<v Speaker 2>We're speaking of Brad Finkel, founder and CEO of Hoboken

0:07:08.880 --> 0:07:11.840
<v Speaker 2>Farms here in the studio. You brought the selection of

0:07:12.040 --> 0:07:15.480
<v Speaker 2>what you do offer includes pasta and sauces. How have

0:07:15.600 --> 0:07:18.880
<v Speaker 2>you been able to keep the taste and the ingredients

0:07:18.960 --> 0:07:21.320
<v Speaker 2>consistent as you've scaled and gotten bigger?

0:07:21.360 --> 0:07:24.400
<v Speaker 3>Oh wow, we go? Have you?

0:07:24.480 --> 0:07:25.360
<v Speaker 2>Were you able to do that?

0:07:25.400 --> 0:07:29.320
<v Speaker 3>Well? We go, Yes, we go to every run. We're there,

0:07:29.360 --> 0:07:32.800
<v Speaker 3>so we're tasting tests. We're tasting color, we're tasting viscosity,

0:07:33.120 --> 0:07:38.360
<v Speaker 3>we have sugar content. So if it does not meet

0:07:38.400 --> 0:07:43.360
<v Speaker 3>those expectations, it gets donated to the Community Food Bank

0:07:43.360 --> 0:07:43.880
<v Speaker 3>of New Jersey.

0:07:44.120 --> 0:07:45.600
<v Speaker 1>But I want to go back because I know this.

0:07:45.760 --> 0:07:47.880
<v Speaker 1>You had mentioned to me that one of the reasons

0:07:47.920 --> 0:07:50.040
<v Speaker 1>you got to disauce is your customers started asking for

0:07:50.120 --> 0:07:53.240
<v Speaker 1>it because I've bought your ravioli, and people were like,

0:07:53.240 --> 0:07:54.080
<v Speaker 1>can I get some sauce?

0:07:54.160 --> 0:07:54.320
<v Speaker 2>Right?

0:07:54.400 --> 0:07:57.720
<v Speaker 3>So, all day, every day we sell now hundreds of

0:07:57.720 --> 0:08:01.640
<v Speaker 3>thousands of lows of bread and tons of Mazdela and barrada,

0:08:02.000 --> 0:08:04.800
<v Speaker 3>countless coolers of ravioli, and people would come to us

0:08:04.840 --> 0:08:06.720
<v Speaker 3>and say, do you have any sauce to go with

0:08:06.760 --> 0:08:09.640
<v Speaker 3>that ravioli? Nope, have any sauce to go with the pasta?

0:08:09.920 --> 0:08:13.280
<v Speaker 3>I do not. Finally, a guy, very Jersey guy, came

0:08:13.320 --> 0:08:15.920
<v Speaker 3>over and said, hey, dummy, who are you standing next to?

0:08:15.960 --> 0:08:17.720
<v Speaker 3>And I looked to my right and it was Kurt

0:08:17.720 --> 0:08:20.360
<v Speaker 3>Olsted from Osted Farms. That was Dale from Stony Hill Farms,

0:08:20.360 --> 0:08:22.240
<v Speaker 3>it was Match from Cherry Grove Farms, it was Dug

0:08:22.280 --> 0:08:24.960
<v Speaker 3>from Race Farms. Fellas got to get some tomatoes and

0:08:25.000 --> 0:08:27.480
<v Speaker 3>some basil and we started making some sauce.

0:08:27.800 --> 0:08:29.600
<v Speaker 2>But you also mentioned that you have to get some

0:08:29.760 --> 0:08:31.400
<v Speaker 2>ingredients from outside of the US.

0:08:31.880 --> 0:08:33.240
<v Speaker 3>Well, olive oil, Yeah, I mean.

0:08:33.120 --> 0:08:35.320
<v Speaker 2>Okay, So is that it is that everything else is

0:08:35.360 --> 0:08:36.480
<v Speaker 2>from from Jersey.

0:08:37.320 --> 0:08:41.600
<v Speaker 3>We do our very best. You know, our original ingredients

0:08:41.640 --> 0:08:46.319
<v Speaker 3>came directly from the farm markets we are. We have

0:08:46.400 --> 0:08:49.280
<v Speaker 3>to make sure that we have the best tomatoes, the

0:08:49.320 --> 0:08:53.240
<v Speaker 3>best basil, the best onions. What I think is a sauce. Now.

0:08:53.360 --> 0:08:55.559
<v Speaker 1>What is so cool is though it's like you listen

0:08:55.640 --> 0:08:57.960
<v Speaker 1>to the community or the community says do this, and

0:08:58.000 --> 0:09:00.000
<v Speaker 1>then when you go to make sauce, you look around

0:09:00.160 --> 0:09:02.120
<v Speaker 1>you and you embrace the community to.

0:09:02.080 --> 0:09:04.360
<v Speaker 3>Do it well. A form market is both an ecosystem

0:09:04.360 --> 0:09:07.400
<v Speaker 3>and an incubator, right. So as an ecosystem, right, you know,

0:09:07.760 --> 0:09:10.720
<v Speaker 3>I need tomatoes and basil, and there's tomatoes and basil.

0:09:11.240 --> 0:09:14.200
<v Speaker 1>Okay, Now I want to go to the community because

0:09:14.240 --> 0:09:16.640
<v Speaker 1>there's a point where you grow in the business and

0:09:16.720 --> 0:09:19.600
<v Speaker 1>you got to think about financing and capital and raising capital.

0:09:20.040 --> 0:09:23.320
<v Speaker 1>And again I feel like the community kind of came

0:09:23.400 --> 0:09:23.800
<v Speaker 1>to you.

0:09:24.080 --> 0:09:26.400
<v Speaker 3>Yeah, so we kind of have a one in a

0:09:26.440 --> 0:09:34.120
<v Speaker 3>million raised story. It became obvious that the opportunities that

0:09:34.160 --> 0:09:38.160
<v Speaker 3>were coming our way meant that I needed a bigger boat.

0:09:40.040 --> 0:09:42.400
<v Speaker 3>So I was ready to kind of start going to

0:09:42.440 --> 0:09:45.800
<v Speaker 3>institutional investors and you know, the banks of America and

0:09:45.840 --> 0:09:50.920
<v Speaker 3>telling my story. When word got out to our customers

0:09:51.000 --> 0:09:53.400
<v Speaker 3>kind of through the grapevine that we were contemplating this,

0:09:53.840 --> 0:09:58.520
<v Speaker 3>some very savvy really it's some very savvy investors said, wait,

0:09:58.559 --> 0:10:00.560
<v Speaker 3>we want to be part of this. They've invested in

0:10:00.600 --> 0:10:03.480
<v Speaker 3>CpG products before. And I didn't have to do any

0:10:03.520 --> 0:10:03.680
<v Speaker 3>of that.

0:10:05.240 --> 0:10:07.040
<v Speaker 1>I got it. We've only got about a minute left here.

0:10:07.120 --> 0:10:09.959
<v Speaker 2>Unfortunately, when you raised four million dollars in funding, we.

0:10:09.960 --> 0:10:12.280
<v Speaker 1>Have Okay, so where do you go with this IPO?

0:10:12.720 --> 0:10:13.080
<v Speaker 3>Sell it?

0:10:13.120 --> 0:10:13.800
<v Speaker 1>What do you want to do? No?

0:10:13.679 --> 0:10:16.640
<v Speaker 3>No, no, no, we are We are building our business

0:10:19.120 --> 0:10:22.040
<v Speaker 3>straight down ninety five, down south to the Midwest. We

0:10:22.160 --> 0:10:27.000
<v Speaker 3>have Pavilions and Lassons in California. We have jewel uh

0:10:27.480 --> 0:10:34.040
<v Speaker 3>and uh, Tony's and Pette's in Midwest Central Market in Texas.

0:10:34.320 --> 0:10:37.880
<v Speaker 3>We are growing our distribution certainly also online as well.

0:10:38.320 --> 0:10:40.079
<v Speaker 3>Uh you know, direct to consumer.

0:10:40.280 --> 0:10:41.920
<v Speaker 1>Do you plan to expand the products?

0:10:42.200 --> 0:10:44.760
<v Speaker 3>Yeah, we have a pizza sauce coming, we have we

0:10:44.840 --> 0:10:46.840
<v Speaker 3>have a couple of other things. But we are a

0:10:46.880 --> 0:10:51.360
<v Speaker 3>small but mighty group of experts. So I was able

0:10:51.400 --> 0:10:55.400
<v Speaker 3>to get those economics to bring on expertise and better execution,

0:10:55.840 --> 0:10:57.960
<v Speaker 3>and that's allowing us to scale a crossomer.

0:10:58.040 --> 0:10:59.880
<v Speaker 1>So why we like talking. It is the backbone of

0:10:59.880 --> 0:11:00.840
<v Speaker 1>the US economy.

0:11:00.840 --> 0:11:02.080
<v Speaker 3>Bred THINKL. Thank you so much