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Bootstrapping a Perishable Meat Business To Significant Scale: ButcherBox CEO Mike Salguero (Part 3)

Posted on Saturday, Mar 28th 2020

Sramana Mitra: It’s so disheartening to see all these great businesses go through a Death by Overfunding. I’ve written extensively about this. 

Mike Salguero: What’s funny is with this business, we haven’t raised any money. We are way bigger and way more successful. So much of the success and where we are right now is because we didn’t raise money.

Sramana Mitra: At some point, you figured out that wasn’t going anywhere, and you decided to leave?

Mike Salguero: My co-founder still runs it. We ended up recapping the entire organization, wiping out all of our investors, and firing our entire staff. He was left with six people to pick up the pieces. I was totally burned out. I thought I was going to take a hundred days off.

I started working with this concept of grass-fed beef delivered to your door. I got into it because my wife and I were following a diet saying to make sure to eat grass-fed beef. I just couldn’t find any grass-fed beef anywhere. I ended up purchasing cow-share from a farmer in New York.

Four months later, I purchased a half-share and gave some to my friends. Four months after that, I bought a whole cow and split it up, and sold it to friends. One of my friends said, “This would be so much better if it was delivered to my house.”

I started trying to figure out how to ship meat directly to someone’s house. I couldn’t figure it out. I met the former Head of Operations of Omaha Steaks. He helped me put the pieces together, and off we went. I didn’t take a hundred days off. I took the weekend off. I started three days after I left CustomMade.

This was 2015. I spent the summer working on a Kickstarter campaign. We launched our Kickstarter in September. The idea was I put in $10,000. That covered everything – legal, photography, video, intern. The idea was this is all we were willing to spend to get to Kickstarter. If it works, cool. If it doesn’t work, at least I learned a bunch about Kickstarter.

Sramana Mitra: When you were going into this Kickstarter campaign, how many people had you already shipped meat to?

Mike Salguero: None. We didn’t even own meat yet. We didn’t want to take the risk of cutting a whole bunch of inventory without a market. 

Sramana Mitra: The friends who bought meat from you, how did you do that?

Mike Salguero: That’s purchasing one cow directly from a farm. We needed a totally different distribution. We shipped frozen. We had to find people who did that. Technically, I had sold some meat to my friends. It wasn’t under the name ButcherBox. It had nothing to do with ButcherBox yet. 

Sramana Mitra: You weren’t really bringing in a community of people who were sold on your concept to Kickstarter.

Mike Salguero: No. We started Kickstarter with no idea of who was going to buy. You start with friends and family. Our initial goal of $25,000 came within 20 hours. People were very interested. We ended up doing $210,000 in sales.

Sramana Mitra: What was the logistics of that campaign? How did you manage that Kickstarter campaign? Was it pre-orders?

Mike Salguero: We got our stuff out four weeks later. As the campaign started, we started buying products. We had a facility that had both cutting capabilities and also shipping capabilities.

This segment is part 3 in the series : Bootstrapping a Perishable Meat Business To Significant Scale: ButcherBox CEO Mike Salguero
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