How to introduce a new product into a mature market; Oobli challenges US$40b sugar industry.

Hello and welcome to this episode of The Unnoticed Entrepreneur with me, Jim James. Here I'm providing you with the best and most trusted source of information for you as an entrepreneur, real source examples of how you can get your business noticed. And who could do that better than Ali Wing, who's joining us today? And we're going to talk about sweet proteins and a company called Oobly. Ali Wing, thank you for joining me today.

Thank you for having me. I'm excited to be here.

Well, I'm excited because I've learned that 75% of all food has sugar in it. And as we all know, obesity is an issue all over, well, all over the world, certainly in Europe and North America. We have issues with diabetes, for example. But the production chain and the industry of sugar is huge. And you and I are going to talk about how a company, Oobly, has launched the world's first sweet protein product and tackling the question, getting across Moore's Chasm of, are you going to deal with the consumer or the companies first? So, Ali, we've got lots more to talk about, but that's just a taster, if I can say that. So, tell us about Oobly and let's dive into how you're crossing the chasm.

Well, Oobly is sort of this little revolution in the making, and I'm excited to share it with everybody. We are a sweet protein platform and it's a biotechnology company. I give a ton of credit to my 2 founders, and particularly our CTO, Jason Ryder, for the 8 years of work of sweat equity into the point where I joined them to help bring this to market. And why— what are sweet proteins and why are they so important? Well, sweet proteins are the first time we've ever had available in the world, let alone in any way in our food system, a protein pathway to giving us our sweet tooth. Um, rather than a carbohydrate pathway. And that's so important for the reasons you set up, Jim. Um, the fundamental different sort of difference mechanism of action of proteins versus carbohydrates is that carbohydrates, whether it's a sugar, sugar alternative, plant-based or not, all interact with your blood sugar system and your gut microbiome as they digest, and proteins do not. That's the simplest form. Why is that so important? You did such a good job of setting that up, which is really, we have a massive issue in the world today on 2 fronts, on obesity and diabetes, which is not because it's bad for people to have a sweet tooth. In fact, I have a sweet tooth, we all do, we're designed to. It's really the amount that's in our modern food system. And equally, we produce so much of it. You look at any top 10 most harmful crop in the world, and it's sugar. And it's not to demonize sugar, 'cause it's actually a really important thing, kind of like fossil fuel. We just need to use it differently. And one of the ways we can do that is quit producing as many in such precious ecosystems as we currently do. Sweet proteins are a pathway for both of those solutions.

So, Ali, with Oobly, with the sweet proteins, so it's a biotech breakthrough. Would that be right?

It is. It's— this is— I like to say this is the perfect marriage of the best of nature and the best of technology because Sweet proteins are inherently plant-based. They come from plants and berries that grew along the equator to solve a problem of staying alive with precious resources. And they evolved to produce one little tiny protein that only tricks, only works apes and gorillas and humans. And it makes us, it tells our taste bud, you just got sugar, but then it moves through your body as a protein, which is fundamentally different than a carb. Probably a dirty trick to an ape or gorilla on the equator 100 years ago, but maybe the perfect solution for humans today. But we've known about them for about 20 or 30 years, but we didn't have a way to produce them. Then enters what we now know in biotechnology or synbio and the advances there in fermentation. And now we actually can take the DNA from that plant or berry of just the protein, and we teach our yeast to produce it in a climate-friendly and scalable and affordable way that allows us to then have a nature-identical end product. That's exactly what we got from nature, but available for everybody. A lot like how we do beer or wine, right? Beer, wine, and cheese. In some ways, fermentation is an old-school technology. We've been doing it for years in food. And in fact, the yeast we use has been used for centuries. And really, it's the same. It's just that we didn't used to be able to understand the DNA of a plant and put it into that yeast and have it grow that. And that's what's different and so exciting. And I think, you know, sort of the perfect example of a marriage between nature and technology.

Yeah, I can see on your website it's saying that just even a 1% reduction in sugar production will save 650,000 acres of land. So I guess cane and beet are fundamentally unfriendly to the planet, and this sugar protein is an amazing way of doing it, of solving that problem. But Ali, you know, when you introduce something new, as you're doing. There are entrenched industries, aren't there? Whether you're doing food or medical tech or climate tech, there's a lot of money in sugar already established, isn't there?

There is.

And consumer behavior, of course, is already maybe about sweeteners, for example, and saccharin and replacements. Tell us, how are you at Oobly going about sort of changing and introducing Sweet Protein? Because you're not just introducing a new product, are you? You're actually potentially transforming supply chains, value chains, and consumer behavior.

I think that's right. You know, I'm a, I'm a disciplined consumer marketer. That's my background. I live, you know, I start and stop with the consumer. And I do believe that great change is happening by Sort of lighting the fire in consumer change. So you you said this, and that we said we associate today sweets with sugar, and what I want us to be able to do is to reassociate sweets with something other than sugar, including sweet proteins. Right? But the pathway to do that is, I believe, the same. I'm not trying to disrupt an industry. I'm actually trying to solve a crisis, and the crisis is obesity and diabetes throughout the world. And while sugar is not The sole culprit, it is a chief culprit. And proteins can be a pathway for a massive rehabilitation. The bonus is by fermenting it, we can actually then have the effect that it also improves the climate, and it does have an effect on how we distribute, sort of getting our sweets in the industry. But that's not really the objective. The objective is to solve a health crisis and to give us palatable, Mm-hmm. craveable, first-choice foods. that are better for our body, or at least we like to say as good for our bodies as they are for our soul. We all love the soul of our sweetness, but our bodies can't handle the amounts. And so that's really it. We start and stop with the consumer. Here's what I would tell you, Jim. We are not starting this revolution. 75%— let's just take Americans for a minute— the data suggests 75% are actively trying to reduce sugar. The data would also suggest they're just kind of failing. There's about 50 forms of sugar today. The labels are pretty complicated, and they've kind of lost their wayfinding. They don't really know what to trust, and there's been a lot of marketing that has come out afterwards and said, hmm, this is a problem. Look at all the news on sugar alternatives. Whichever clinical trial you agree or disagree with over the last year and a half, there's a little bit of red flags going up all over to say, hey, just more carbohydrates of this form isn't actually making us healthier. And I always say, take a simple look and say, step back and look at the last 25 years. I'll pick on the US, but this is not unique to the US. It's throughout Latin America, it's parts of Europe, it's certainly throughout India. We're seeing it throughout the world as a result of our modern food system. But what we do know is that 25 years ago, we were healthier than we are today. So there's been an expansion of sugar alternatives during that time. I'm glad there's lots of innovation. There's clear consumer demand. So where do we step in? It's try to build a better solution for that demand. But we're not creating the demand, the demand exists.

Ali, you know, one of the functions of sugar is also as a preservative, isn't it? We put sugar in things to keep it, you know, to crystallize it. Um, what role does sweet protein play? I don't, don't want to get too technical, but just because, you know, consumer behavior is that sugar is also you know, good for preserving things and so on. So does sweet protein play the same, if you like, sort of preservative as well as sweetening role, or does it need to change?

It does not. And that's such a great question, Jim. Sugar is a super important crop, and I'm not advocating it goes away. I'm just advocating it probably shouldn't play every role it's currently playing in our diet because we can do more with sweet proteins and reduce the load of its unique characteristics like bulking and preservative. Sweetness. Sweet proteins can deliver sweetness. Sugar delivers sweetness, but sweet proteins are protein. They're not a sugar, so they don't do some of those other things. So let me give you an example to ground this. We came out with dark chocolates. If you think about a chocolate bar, 50% of a chocolate bar, the weight, the bulking is sugar. So when we took it out to reduce the sweetness, 75% less sugar in our chocolate bars. Hopefully you can't tell a difference. Most consumers can't tell a difference. We had to put something back in for the bulk, or we were going to give you half the size of a chocolate bar, right? Which nobody would really like. And we, so we put in an acacia fiber. So we're using dietary fibers when we actually have to replace bulking. Now, that doesn't mean you couldn't still use sugar in other forms. So again, I really do use the analogy to fossil fuels. I don't, I would be the last person to say it's not critically important to our world. I just think we have to use it better. We have to upgrade its role. Sugar, we should upgrade its role. Ironically, sugar is actually an input to a fermentation process. That's actually part of production process. So it's an important part, plays a lot of different industrial roles. What it probably shouldn't be is be the sweetener in every one of our drinks, our yogurts, and our candy bars. We can do that better. And we can do that better for our bodies.

Ali, you've given me an education. And we've only been talking, you know, for 8 or 9 minutes about the subject. And it's fascinating. One of the issues is to differentiate between something being sugary and something being sweet, right? And that actually sugar and sweet are not— it's not the same thing, right? That actually you can have other things that are sweet that are not just sugar. So that seems to be really important. But you've been educating me, for which, you know, thank you and forgive my ignorance. When you're introducing a new product and a new technology, In your role as CEO of Oobly, how are you addressing the market? Because as good as it is, if there isn't adoption, it'll fall by the wayside. Tell us how you're solving that, Ali Wang.

That's exactly right. And I will underscore, it's been a lot of years for most people since they had Biology 101. So I can't start explaining small molecules and large molecules and Why it's different. And frankly, most consumers don't want to spend the time on that, and they shouldn't have to. So getting to simplicity is our single hardest problem, but the most important solution— and I would say this is true for anything in food— at the end of the day, we are spoiled modern consumers today, and what we usually start and stop with in our choices are what we love and what tastes great. So for me, craveable food is the number one thing that I want to interact with consumers on in an early launch. And with a craveable solution in their mouth, I get a pathway to potentially educating them on why that's special and different. But because of that, I would say trial marketing and trial sampling is a mission-critical part of any part of my marketing mix today.

And how are you doing that, Ali? Because it's the old chicken and egg, isn't it? If the product's not in store, and it's just online, for example, and it's, you know, people aren't necessarily looking for sweet protein-based products. How do you get the first ones?

Absolutely. It's a great question. So we are literally selling the first-ever sweet protein-powered products in the world, right? And they launched in mid-June. So this is brand, brand new. I can even be talking to biotechnologists who are like, sweet proteins? Do you mean proteins that are sweeter? Like, you know, we get the same questions. So we knew that it's novel. So I'll start with what we did this summer. The first thing we did is we, yes, we went online. Yes, we are very focused digitally at education. So lots of experts bringing on strategic advisors, providing the content for when somebody is going to experience this, has a place to go find out about this information. But how do we get them to go find out? Well, we picked a market. And so we, for a bunch of reasons, we chose LA this summer and we sampled more than 15,000 teas. In the months of July and August. And we showed up where we think our consumer demographic is, which is an early adopter innovator who's willing to think about their diet in different ways that is showing up in culturally relevant locations. So we were at movie nights in LA. We stood at the bottom of very popular hikes in LA, Laurel Canyon, for instance, on Saturdays when everyone was coming from their morning hike and we handed out cold free teas. So we did a lot of sampling. We've now taken— we're done with sort of our summer campaign. It was a really effective campaign. We got a lot of questions, inquiries, first reviews, starting conversations, which is really the goal of wave 1. Now we're entering fall and we're expanding into other markets. We're now in about 75 retailers in California and we're starting to roll that out. And so we really had to tackle this issue, I think, to your question of how do you do sampling digitally. And so we made a decision, we actually just launched it early September, that we actually are also going to do sampling online, which is a little tricky when you've got drinks because you don't really want to send them out in less than 6-packs. It's not cheap. So really what we're doing is we are creating— we have several campaigns running where if you take the time to go listen to Dr. Jason Ryder, our Chief Technology Officer and also the head of biotechnology at UC Berkeley, To walk you through why a protein pathway for sweetness is so different than a carbohydrate one, and you invest that time, we send you a free 6-pack. All you have to do is pay for shipping. So we are very much invested in trial and it's still going everywhere.

Lovely. And I've got your website open. And for those people that are watching the YouTube, you can see there's a store locator. And for those of you that are interested, you can go to Oobly, that's oobly.com, and you can start to see the store locator and wholesale sale opportunities as well. Yeah, when I imported a drink called Wake Drinks to China, which is a guarana-based sports drink, I went to the marathons and on the Great Wall actually and gave out drinks. It was one of the hardest sort of trials I had to go up the Great Wall carrying large quantities of drink. You've been smarter than me, of course, Ali. I would expect that of you.

Well, distributing drinks is not for the faint of heart. It's a lot of hauling in bulk.

Yeah, that's for sure, but well worth it. Um, what is the, uh, if you like, the taste test? Because obviously in soft drinks, you know, we saw Pepsi and Coke do, do the sort of taste test wars. Ali, how are you helping people then to, you know, you know, experience the difference? And then what are you doing with the results of that? Because you've got people who then become evangelists. Presumably.

For sure.

How are you amplifying their experiences?

Well, huge. So the way we approach our model food system, so we have 2 products out, right? We have sweet teas, we have chocolates. That's certainly just the tip of the iceberg because we're also working with large companies on rehabilitation of their products. In all those cases, when we design the product, we're not trying to tell a consumer what to taste. We're asking them, what's your favorite drink that we're gonna target and replace? And then we reformulate so that it's 4 outta 5 consumers can't notice a difference that we made to the product. And that's really very important on all our testing. And then we go out and bring it out. So, for example, our teas, they have 7 grams of sugar in them, 'cause they have 5 grams of fruit and 2 grams of agave, because we're reducing the equivalent in-demand tea that we wanted to sort of compete against by 75% sweetness. But in order to give them what the taste they're used to, I'm only still working with our first protein that's regulated. I can reduce it by about 75%. When I have 2 or 3 proteins in the market, I can probably get closer to 80 to 90 without them noticing a difference. But I really don't want to ask the consumer to make a change. I want to give them everything. I want them to be as spoiled as they are and give them a better equation for their body. So we start with taste. And then as we bring these products out, it's really about, we encourage trial, we're asking for reviews, and we let the consumers speak. Right? So we want to hear it all, good, bad, and ugly. I think most consumers today take more seriously products that don't have everybody that says it's perfect because that feels manufactured.

Yeah.

And preferences in foods are very varied. So we could have the best tea in the world and there's going to be some people that don't like it. I want everybody to see what everybody's saying and let the numbers speak for themselves. So far, that's what we feel really excited about. We put a lot of amplification to other people commenting. We've even taken a step, and I'll give this as a marketing tactic, we've gone out kind of a lot of the old Pepsi challenges, which we, we do in our own consumer testing. We go out and do the equivalent in downtowns all the time. But we've put them online with some chefs, and we've just let them pick what they're going to taste challenge against. And they've actually been blindfolded, and then they'll actually say what they like, what they don't like. And, you know, Many times that's exactly what we want to hear, and sometimes it's different than we want to hear. But I think that credibility over time is best-in-class marketing today when you're bringing something disruptive to the market. It's transparency around what it is, and consumer tastes are very varied, and consumers generally get that today.

Well, and it sounds as though, although it's a disruptive technology, you're not making it a disruptive experience to the consumer, which sounds like, you know, the adoption. Ali, is there something that you would say that Azubli hasn't gone quite as planned or a lesson that you've learned? You know, I never try to embarrass anybody, but in the spirit of sort of entrepreneurs sharing, it's always useful to find something that may have been done that was an experiment, for example, that didn't quite yield the results.

I have my biggest mistake and I own it. Like, this was 100% me in the middle of it. So, but you know, that's the game, right? Is you move fast enough that you have to be comfortable being imperfect. That's the stomach of an entrepreneur and you have to have that.

It is.

I'm a big believer that you, there is no such thing as a perfect product. There are great products and there are smart practices, but there's a wide variety of consumer preferences. So, the important thing to do with, once you have a good strategy, is to get to market and let the actual buying market behavior tell you your true feedback. Because you do a lot of research upfront, But even one of your earlier guests on your show, the ethnographer, would say you only get a partial amount of the information until you get out of the way and let them experience their product without you managing it. So you learn a lot. So the mistake we made, and it's sort of funny because it's so simple in some ways. So in our can and our packaging of our first tea launch, we were so excited about bringing out this craveable sweet tea that had 75% less sugar than an equivalent and no sugar alcohols or anything in it. So just this kind of clean ingredient reduced We were so excited about that low-sugar discussion, we didn't pay enough attention to how protein was going to show up on the nutrition fact panel. And here's the deal. Sweet proteins are actually 2,000 to 5,000 times sweeter on a weight-weight basis than sugar. So when you take out, let's say, a typical soda has like 18 cubes of sugar in it, and we would replace that with water and about 0.03 milligrams of sweet protein. So it's proportionately a lot different. So it'll be a small part of your nutrition fact panel. Well, when our lawyers did the NFP calculations, that nutrition fact panel where it shows on the back what percent's everything, if you're under 1%, it just says zero. And our protein actually is about 0.8% within the product. So it said zero. So I go out and I launch this great sweet protein-powered product that has this awesome taste and reduced sugar, and everyone gets that, but they turn it over and they're like, but it has zero protein, so what is it? I thought it was protein. Total miss by us. So we did a quick run and we redesigned the packages and we— it was perfectly legal, we just didn't know to do it. We could have put less than 1% and put a little asterisk and had an explanation so that people understood. We like to call them now our tiny superheroes. These little proteins do a lot. So it doesn't take very much to do it or you'd oversweeten the product. And so now we explain that. So that's a great example of Fail fast, admit it, and adjust. And we did.

Well, not only— I think, you know, it's also, um, an example, A, of your, of your, um, sort of scientific approach, right? You learn. Um, but also that consumers do care what's in the product.

They do.

You know, that, uh, they don't take it for granted, and that the label readers— and I read, you know, for my daughters, you know, the, the Zero Coke, Zero Coke I hate all of those, but I can't understand necessarily the difference. They all seem to have sugar in them. And so there's a lot of anxiety amongst consumers.

There is.

Isn't there? Especially in parents as well and anyone involved in nutrition. So being clear, as you say, for the label readers amongst us, really, really key. Ali Wing, CEO of Oobly, and you've been an entrepreneur, you've been in and out of many businesses, led them to great success, as I'm sure you're going to do with Oobly as well. Is there something that you would recommend to my fellow unnoticed entrepreneurs on moving the needle, something that you think really, really helps and that everyone should have in their plan?

Yeah, you know, it's hard to be— I've been in 5 industries. So my job is always to kind of partner with a technologist to unlock technology for better health. Like that's kind of been my career, but I've done it in a lot of different applications. So I would say it's always hard at a marketing mix to say across industries or product types because they're so different. So I'll kind of give you a couple themes. I think one is fail fast. Don't be afraid to be in market and learn because actually, despite what a lot of people think, I think consumers are actually pretty forgiving. They're not forgiving if they don't— if they feel bait and switched. If you're transparent about it and you come out and you make decisions in market and you react accordingly, I think you're generally rewarded in today's market. And I haven't seen very many case studies. I hear horror stories about it when they're not, but I don't actually see that in practice much. So, I would say fail fast. My example of my mistake is a good one. I would also say avoid the illusion of perfection. There is no such thing. You know, I always tell my teams, the only truth about our plan today on execution is it's wrong. The only truth is we're building the first ever sweet protein-powered products in the world. So we don't know much more than what we do know, right? So all we can do is build, be smart and agile. And so don't have an illusion of perfection and expect that you will adjust as you go. Lean into that. And then I would say third, to do those first 2 things and have them be effective, it's all about measurement. Understand and design systems of measurement to understand, make sure you know what you learned. Because it's not okay to make the same mistake twice. It is okay to make it if you've measured it and learned from it. I would say those are the most important principles.

Ali Wong, and now I know why the investors, you know, sought you out and brought you into Oombly with your amazing strategic oversight and the ability to make it all accessible, which you've done and introduced. You know, it's such an exciting new innovation, sweet proteins. So thank you so much for coming on the show, Ali Wing. And if you want to find out more about you and Oobli, how can they do that?

Oh, definitely everything Oobli. Check us out at oobli.com, O-O-B-L-I dot com. We go out of our way to put a lot of content, even our strategic advisors, we have a scientific advisory board, are posting a lot of great content because sweet proteins are so brand new to the market. We know you might just want to visit and learn more, and we're posting a lot of third-party links that are there too. So I encourage you to go check out our blog. I encourage people to sign up for our list for our Be in the Know, which is basically we're going to let you know where else you can find us, which products we're in next, because our our products are the first products out there ever teas and chocolate. But we're busy working with a lot of companies and a lot of products you already love to see if we can rehabilitate their products and give you just the same taste you've already loved, but something that's better for your body. So stay tuned for those. announcements. And of course, personally, feel free. I'm— you can find me at LinkedIn, and I'm at Ali Wing, just like it's spelled, A-L-I-W-I-N-G.

Ali Wing, CEO of Oobly. Thank you so much for introducing this whole new concept, really, and whole new technology, and also how you are crossing the chasm, introducing, you know, the new sweet proteins that let's, let's hope are introduced for this generation to start to address the health issue. So thank you so much.

Thank you. Thank you for having me.

It's been a pleasure. So what a lot to learn from Ali Wing today. And, you know, for me, one of the main takeaways is this need to get trials, you know, that the product goes in and you try it and get the first anchor clients to try it. It's a recurring theme because we had Melissa Snover of Nourished as well talking about this, about getting the first tests and getting people to evangelize the products. If you've enjoyed this show, please do share it with a fellow unnoticed entrepreneur. And if you can rate the show on your player, that also really helps. And leave a review, helps me to understand what you like about the show and also what else I can do better. And until we meet again, I just encourage you to keep on communicating. Thanks for listening.