When the coronavirus began to shut down schools, a major source of food for kids all across the country, the company's mission took on new urgency. Everyone involved with Revolution Foods swung into action. As she recalls, "once we as a team and ecosystem of stakeholders got our plan together--and a big part of that was our incredible school partners, who said, 'We are going to feed as many kids and families as we can,'-- within a week, we were building at light speed what would be the next iteration of Revolution Foods and our feeding system."
Because it's not only kids who are being affected by the pandemic, that new company has, as Kirsten explained, "developed new menus and evolved our culinary platform to include adult meals, senior meals, meals that can be consumed without being heated up because they're being delivered to people in homeless encampments and whole new ways of getting meals to people in need from a packaging and logistics standpoint." It's an enormous responsibility, and a crucial one.
In our conversation, we talked about the history and difficulties of school nutrition before the pandemic, scaling a company while having a young family, what's changed at Revolution Foods since March, and how investors and partners have supported and helped expand the company.
You can listen to my discussion with Kristin and Kirsten on Apple, Google, or wherever you like to get podcasts.
A full transcript is beneath the show resources below.
Highlights from the show:
- Kristen and Kirsten introduce themselves and address the current moment (2:48)
- The mission and history of Revolution Foods (5:42)
- Turning a dire situation into a mission-centered opportunity to help (9:30)
- How the product design class where they met led to Revolution Foods (11:41)
- Why they were drawn to the problem of providing nutrition to kids (15:16)
- Starting the company while also starting families (17:21)
- Supporting and investing in entrepreneurs who are parents (21:19)
- The early days and customers of Revolution Foods and how it grew (24:02)
- Why school nutrition programs have been challenging (26:48)
- A for-profit company doing public service (30:36)
- Being a good corporate citizen (32:43)
- The company's 2020 plans, pre-pandemic (35:16)
- The moment they realized things had changed (37:15)
- The first days and weeks of the pandemic (39:22)
- The drive and imperative to feed people in a time of crisis (44:52)
- A second founding and rebirth fueled by the passion of the whole team across the country (46:25)
- Raising awareness about the scale of hunger and of the solutions needed (48:59)
- Policy recommendations for getting through the pandemic in "a safe and stable fashion" (52:22)
- Where philanthropy can have the most impact (55:57)
- The silver lining of food security innovations (58:05)
- How to help now (59:24)
- Where we go from here (1:01:21)
Show-related resources:
- Revolution Foods
- The Impact of Coronavirus on Food Insecurity
- Hass School of Business, UC Berkeley
- B Corporations
- FoodCorps
- Brian Chesky on Out of the Crisis
- USDA food waiver program
- Feeling Good Project
- World Central Kitchen
- Share Our Strength
- Maslow's Hierarchy of Needs
Transcript of Out of the Crisis #19: Revolution Foods
Eric Ries: This is Out of the Crisis. I am Eric Ries.Within a matter of days, the schools were shut down. We had no other choice. I've spoken before about the effect that this had on learning, but what about the other social services schools provide? Schools are about so much more than just education. For many students, schools are the one place they can rely on for a consistent meal. This structural inequity is truly awful and the schools being closed made it worse. But looking deeper, you can see that it isn't just about getting food to under-resourced children, our entire food supply chain in this country is fragile and unpredictable, especially for the most vulnerable among us. It's not like hunger is a new phenomenon. The tragedy of malnourishment was a regular feature of the old normal, but it doesn't have to be in the world we are rebuilding right now.
Kristin Richmond and Kirsten Tobey have been working on fixing the problems with school food for more than a decade. Together, they founded Revolution Foods in 2006. Their mission is to build lifelong healthy eaters with kid-inspired, chef-crafted food. They were providing low-cost healthy meals for schools across the country and, before the crisis, were delivering two million federally reimbursable school and community meals per week nationwide. So when the pandemic hit and the supply chain began to unravel, Kristin and Kirsten jumped into action. They used their existing infrastructure to start getting meals into the hands of those who need it most. They found ways to support longterm care facilities, homeless shelters, and other locations serving those most at risk, all while schools, their main source of revenue, were closed.
Rev Foods rapidly scaled up. But as you'll hear, there is so much more to be done to stop the tsunami of hunger washing over our country. We need to turn our entrepreneurial talents to start solving problems of this size and caliber now. Mass hunger may seem like a problem too big for any one of us to tackle alone, and at some level it is, but every time we try to solve our major problems like food disparity or education inequity, we learn and get closer to a solution, so let's not wait anymore. Pretty soon it will be too late. This is still an exponential crisis and every day matters.
Here's my conversation with the founders of Revolution Foods.
Kirsten Saenz Tobey: My name is Kirsten Saenz Tobey. I'm the co founder and Chief Impact Officer at Revolution Foods. I got into this work with Kristin because I started my career as an educator and saw firsthand what it looked like to have both not enough access to high quality food, and also enough access to high quality food and how that impacted their ability to learn. I have long been an advocate of high quality nutrition and food access, and this has been a great journey in doing that at a large scale.
Kristin Groos Richmond: My name is Kristin Groos Richmond. I'm the co-founder and CEO of Revolution Foods. I co-founded Revolution Foods with Kirsten Tobey in 2006 to ensure quality food access for all children across the nation.
Eric Ries: So thank you both for coming on and for the work that you do every day, and especially in these difficult times. Before we get into the story and the company, how are you doing? How's your team been? How's everyone holding up in these dark days?
Kristin Groos Richmond: Well, it's certainly been a historic moment for our country in every way. We are dealing with a pandemic and crises that has left so many people unemployed and, especially relevant in our job, food insecure. And we've layered that with another crises of the exposure of continued racial injustice throughout our communities. So leading a team that is mission-driven, incredibly diverse, and incredibly committed to access across our communities has been both a challenging, but also a very motivating force for our team. So I'd say we're holding up, but we're being very honest about the pressure, challenge, fear, the questions that are on everyone's mind right now and trying to hold space for that.
Kirsten Saenz Tobey: I would agree that the team is working harder than ever and also in very different conditions than we've ever worked before, whether that's folks working at home or folks working as essential workers in our culinary centers. The emotional impact that that has on everybody, along with the sort of layers upon layers of crises that are happening in our communities, makes it not an easy time to be working on anything. But I think having the mission propel everybody's spirits forward and knowing that every day we're all coming in and doing what we're doing to make sure that people can get through this crisis, and potentially more crises, better nourished and in a better place is what keeps us all going every day.
Eric Ries: Talk a little bit about what the mission of Revolution Foods is.
Kirsten Saenz Tobey: The mission that we have held since day one, 15 years ago, has been to create access to high quality, and we like to say, it inspired chef-crafted food.
Eric Ries: I really admire the company, and I have for a long time, and in the interest of full disclosure, I'm an investor, so been on this journey with you for some time. But I especially admire the way that you have thrown yourselves into relief efforts very different from the product that you were building just a few months ago. So would you talk a little bit about the history of the company and what the product was pre-crisis. I think it would be useful for people to hear how the company came to be, what you were both doing before you started it, and what's been the journey till now.
Kirsten Saenz Tobey: We started out with a mission that was really focused around feeding kids in schools who had less access to high quality food because of the neighborhoods that they were living in, because of the communities that were in food deserts, and we looked at the rates of health challenges related to nutrition in those neighborhoods specifically, high rates of obesity, diabetes 1 and 2. Kids growing up in communities of color is at a risk of contracting type 2 diabetes. Even when we started, and some of these statistics have gotten worse, but one in three kids in America are overweight or obese, and a lot of this is because of lack of access to good high quality food and culturally relevant food in the places where these kids spend most of their time.
So in our early days, we were very focused on the sort of K through 12 education space. We started out serving charter schools, very quickly expanded our program to be able to be relevant for public district schools. Even up until this year, probably three quarters of our business was in schools and then the remaining part of the work that we did was in afterschool programs, preschools. We had just started expanding into some senior meal programs. But all of those meals that we have been providing for the last 14 years, qualify for the federal subsidy programs that are designed to increase food security for kids and families in low income areas. That's the national school lunch program, school breakfast program, after school supper programs, and then senior feeding programs that are all federal dollars that are going to provide meals to these kids and families.
When COVID hit, we saw that food insecurity was increasing rapidly, not just among kids, but also among adults and families, and there were people losing jobs left and right. I think we're now seeing, as everybody probably knows, just higher unemployment rates than we've seen since the Great Depression, so it's not just kids who are food insecure now, and so we've very quickly developed new menus and evolved our culinary platform to include adult meals, senior meals, meals that can be consumed without being heated up because they're being delivered to people in homeless encampments and whole new ways of getting meals to people in need from sort of a packaging and logistics standpoint.
Kristin Groos Richmond: I would say the three things, to build on what Kirsten just said, the three things that we were able to bring ourselves back to as leaders when COVID hit and we literally lost 50% of our business overnight on March 15th as schools shut down. So it was a dire situation for Revolution Foods as a company, as well as a dire situation for the communities we serve from a food security standpoint. So both of those things happened at once.
We looked at ourselves and we said, what are we best at? What is our super power? From a mission and purpose standpoint, we have always been about access and quality, so that was a natural place for our team to lean in harder to the support that we knew would be needed across our communities.
From a product standpoint, we have focused for years on culturally relevant product design, so not sort of sitting in an ivory tower and saying, "We know what kids in communities want to eat across America." These are incredibly diverse and proud communities with their own culinary legacy and pride, so we've focused demonically, I would say, on designing product that is respectful and appealing to a broad range of students and families, so we knew we had great product design to address diverse communities.
And then we also looked at our operations and said, "We have a footprint across the US that can produce and distribute millions of meals every week, fresh meals to 400 cities and towns at incredibly affordable prices given the way we have cost optimized our footprint and our program." So we looked at those three things and we, I would say, turned on the turbo gas, I guess, like you wouldn't believe, and due to an amazing ecosystem of team leaders and city leaders and school partners and investors, just catalyzed the message across communities to say we're here to serve right now and we can scale very quickly. That was a blessing for our team and for the communities we serve.
Eric Ries: So how did you two meet?
Kristin Groos Richmond: We met in Business School at UC Berkeley. We were at Haas School of Business. Kirsten and I met actually the first day of school and became friends, but became business partners in a product design class where each student was tasked to come to the table with a new product idea. We both came to the table with transformative vision around healthy meals in schools and the fact that the quality of meals that our students were receiving generally were not high enough and not respectful enough. We both had a vision, from slightly different angles, to start a company that would increase access to healthy, delicious, and very affordable food so that it could be accessible to all students.
Eric Ries: I think most of us, when we think of product design, we think you're going to reinvent the washing machine, or a phone app or something, why this?
Kirsten Saenz Tobey: So the class was a product design class, but I think that the question that was asked is, what's a problem that you see in the world that needs to be solved? So it was much less about sort of what's the next cool widget that you can design and more about, where do you see a need in the world around you? It was one of these really cool classes where we were encouraged to really think big about don't think of the solution, think of the problem.
I remember that day when we both came into class and each were talking about the problem of kids not having access to high quality food in their communities, probably because we both had come from backgrounds where we were working in issues of education, and nutrition, and food, and had sort of seen this really firsthand as a burning need in our communities, that there's a lot of work being done around, or at least at the time when we were both very interested in education, there was a lot of work being done around education reform, and what's the right way to teach the whole student and all of this work. But for people who are really interested at the core, I think, being involved in education in some way, we both saw that the sort of lack of nutrition and lack of culturally relevant food for kids who were disproportionately suffering academically and from a health perspective, that that was an enormous need that we both saw.
In some ways, at that point, we didn't know yet what the solution exactly looked like, but we saw this big sort of problem in society. The very cool thing about the program, and then some of the other business planning classes that we took afterwards, was we were really encouraged, I think, to look at the need and talk to the people who are experiencing that need most sort of dramatically out in the real world. For us, that was kids, and students, and teachers, and principals, and parents, and understand what the nature of that need is before you assume you know what the solution looks like.
Eric Ries: What was it about this problem in particular that you felt drawn to try to solve it?
Kristin Groos Richmond: From my perspective, I started my career in investment banking, completely different segment, but had a life-changing opportunity to help start a school actually overseas in Kenya and saw, day in and day out, the advantage that students who were well-nourished, and that could mean coming to school having eaten a good breakfast, coming to school with... In our case, we didn't provide lunches at this school, so coming to school with a healthy lunch. The difference that that made when we had morning and afternoon classes, their ability to focus, their ability to engage, their ability to certainly score well on tests. But it was in and out of the classroom. And so for me, I felt, and I think Kir and I both share this core belief, that every child deserves access to an incredible education and every chance in the world to build the life and career of their dreams. You can't do that without quality nutrition and without health on so many levels. And this was a gap that our friends in education, our teachers, our principals ... We had a superintendent at one point say to us, "Kris here, if someone can solve this and help bring a quality solution to the school space, sign us up. We'll be your first customer." And that kind of testimonial kept coming back over and over from our friends in the education space. And so I think we saw it and still see it as a core piece of whole child learning and really as a big social justice issue as well in terms of providing all of the levers and touchpoints for students to be successful.
Eric Ries: When did you start the company?
Kirsten Saenz Tobey: So we started the company in 2006. We literally started just as we got our first term sheet for investment on the day that we graduated from business school in June of 2006. And it was actually the same time that Kristen was giving birth to her first baby, literally the same day that we received the term sheet and graduated from business school. So it was a big day.
Eric Ries: Funny how life works, huh?
Kristin Groos Richmond: All at once.
Kirsten Saenz Tobey: And then we started serving our first meals in August of 2006. So after running a very small pilot program while we were in business school to kind of do some early product and concept testing and actually get food out into lunch rooms in public schools, we were able to use that pilot program as sort of a way to gain some visibility with potential investors and to bring a couple of our early investors on board to help us get started. So we opened our first kitchen in that summer of 2006 and started out serving 500 meals a day out of that little rented corner of a catering kitchen in 2006. And we finished that first year serving closer to 1,000 meals a day, which felt like a really big increase going from 500 meals a day to 1,000 per day in that first year.
Eric Ries: It all seems like it happened remarkably fast. And I got to ask actually, because you brought it up, what was it like to do all this and also be a new mom?
Kristin Groos Richmond: So the interesting fact is Kir and I, between the two of us, have had five children in the course of starting and building this company over 15 years. So I've had two little boys and Kir has had three little girls. So we are now very well-versed in being parents and entrepreneurs. And I once had an impact investor, who you know well, who said to me, "It's okay. You're going to be tired anyway. So you might as well be tired both as a mom and as an entrepreneur." And she's like, "The people I know who get the most done have the most on their plate." And we always hear that. But it's been very inspiring.
I mean, number one, having a co-founder who has always held that space of look, we've got each other's back, and that has been absolutely key. Number two, it's really amazing to be a parent when you're building a company and a mission that is all about quality access for children and helping parents, many of whom are working multiple jobs, frankly, both moms and dads and single parents and grandparents who are raising kids. To say, I actually feel a little of what these families are going through every day, and I can deeply empathize with a parent's desire to always do better by their child. And so that piece has been, I think, even more powerful as we've pursued the journey of being, in our case, moms and founders and CEOs. It's been a really powerful piece of the journey.
It's been great for role modelship on our team and for other leaders, women and men, frankly, who are looking to start families and always come and ask us, "How do I do it?" We can do a whole other podcast on that. But I think generally it's been an incredible experience. And the thing about it is when I asked my boys, if I ever say, "Oh, gosh, I'm sorry, I can't make this. Or I'm sorry, I have to work a little harder to do this," they say, "Mom, you guys are serving kids food all over the country. We know you can't miss this. We know you can't be late to this. We know you have to be there." So it's a pretty incredible kind of full circle.
Eric Ries: I appreciate you sharing those stories because it runs so contrary to what has become, I think, kind of a gross conventional wisdom that being a parent means you can't work hard enough or you're not productive enough, or I'm not even really sure what the theory is. But you can't be an entrepreneur and a parent at the same time, that just it's too difficult. And it's, I think, especially in the tech industry, part of a very family unfriendly set of beliefs about what's important about people's whole identity and bringing that to work. So I wonder if you have encountered resistance or confusion. You have investors from the impact space, but also some straight from the technology industry. Has that been an issue at any time in the company's history?
Kirsten Saenz Tobey: I think for us, what's been pretty interesting is we've had an incredibly supportive group of investors and board members and executive team members, many of whom are parents themselves. And I think maybe if we weren't being productive, we might get more skepticism. I think probably if you ask the people that we work around and work with, they would say that we are working and more productive than a lot of people that they know who aren't parents. I think that there's a lot of sort of proof is in the pudding in what are we creating and what's the outcome of what we have done that kind of impacts people's judgment of whether it's possible.
What I always tell people when they ask about how can you be a parent, especially people who are just starting to think about starting a family or what have you and being an entrepreneur at the same time, I mean, one of the things that Kris and I have always said to each other is, "There's never a great time to have a baby in your life. There's never a bad time to have a baby in your life." You sort of figure it out as you go and, if anything, and it's hard to tell somebody who's a new parent this, but I think it actually gets harder as your kids get older and become sort of closer to teenagers that you start to realize that you want to be around for them when they questions. You're not meeting all of their basic daily needs of making sure that they're fed all the time like you are with a newborn, but as kids grow kind of emotionally, their needs change too. And so there's never a great time, and there's not an easy way to balance it all, but there's also never a bad time.
Eric Ries: So starting in that first year, you grew from 500 to 1,000 meals a day. Who were your customers in those early days? And how has that changed over the course of gosh, has it really been 14 years now?
Kristin Groos Richmond: It has been. We started with a group of charter schools in the Bay area, specifically in the East Bay, and they were great kind of pioneer early adopters, very flexible and they could easily implement a new program quickly. We got our track record down, I would say. We really focused on our meal design. We really focused on starting to build out that fresh food manufacturing and logistics capability at a very small level, and it's grown significantly.
So here we are today designing, producing, distributing close to three million meals per week across 400 cities. And our customer base grew probably ... It took about four to five years to really have school districts become a significant percentage of the customer base that we serve just because of scale needs, because of more rigorous procurement processes, just operating track record for the most part.
And we've been able to expand to some very large school districts, including San Francisco Unified and Boston Public Schools. As Kirsten said, we began serving city systems like the City of Houston, the City of Denver, where we have worked with mayors primarily and their mayoral team to implement quality feeding initiatives across afterschool programs, across parks and rec programs, across early childhood programs. And then moving into the COVID period, we've really expanded our adult and family reach.
So at this point, one of the things we're most proud of is creating and providing multi-day family meal packs of meals that we're distributing through COVID right now, 100,000 meals a day in New York City at this point. So it's been fast-scale. And again, our ability to expand and diversify our customer base and our product offering has been all about that combination of product design, manufacturing, logistics, and staying true to, in our case, the mission of a fresh, clean label. So all-natural, no-artificial-anything food, which has been a hallmark of our platform. And I'll tell you, it took us 10 years to really build that clean label supply chain for the community base that we serve.
Eric Ries: Talk a little bit about why historically school lunches and these kinds of programs have been so awful.
Kirsten Saenz Tobey: So I think, I mean, one of the things that's important to say is that there's been a lot of kind of challenge in the realm of school feeding for many, many years. I think for a long time it was just not an area that schools were focused on. It was something that they sort of had meal programs because they were supposed to, but it really wasn't until the last couple ... and in the early days of the national school lunch program, when it first was established in the 1940s, it was really a lot about hiring local people to cook onsite at schools.
And then as time went on and school budgets got more constrained, there was cost cut out of the system to be able to keep some kind of food coming into schools. And that kind of happened along with the industrialization of the food system. And the result was, when you looked 20 years ago at what was being served in schools, some of it was not what many people would choose or would design if they kind of looked at the problem from the ground up. But that wasn't to say that there weren't a lot of hardworking people doing the best they could with the resources that they had. I think there just wasn't a great awareness of some of the health impacts of some of the ingredients that were being served or just the fact that there wasn't a supply chain for school and more institutional feeding settings that could allow for higher-quality ingredients to make their way into schools.
And in many cases, there were facility challenges with what you can do with the equipment and the facilities that exist in schools or that had been maintained or not maintained in schools. And so when we set out, we looked at the fact that a lot of schools don't have the equipment and the sort of culinary capability to design and produce good high-quality food, kind of scratch style. And school systems don't have the resources to be going and doing extensive surveying with kids and asking them what they want to eat and doing taste testing and those kinds of things. And that was the approach that we have taken is like, let's bring the student voice into this. Let's make sure we're very familiar with what the kind of local culinary culture is in the places that we operate, whether it's in New Orleans or in New Jersey or in Southern California, where you have very different sort of culinary cultures.
And so I think that that's where we've been able to kind of take this approach that's just very different from what any individual school is able to do, because we can take kind of our culinary approach. We can bring in the equipment that's needed into our culinary centers that are operating at a scale serving hundreds of schools versus a school district that's serving just a few schools that can't afford to put in that kind of equipment. So I think we've been able to take an approach to sort of quality and cultural relevance because of our scale that individual schools or districts are challenged with doing. So it's not to say that schools have chosen to feed their kids bad food in any sense. It's really that the sort of resources, both human resources and kind of product design resources, that are available to schools were really and are really limited.
Eric Ries: What about those people who think there's something a little bit odd about a for-profit company serving public schools?
Kristin Groos Richmond: Well, this is an interesting topic. I believe that a company's core mission, and this is spoken from a mission-driven CEO and entrepreneur, I believe that the mission is in our DNA and that respect for quality food that has been really part of our governing principles, combined with the ability to raise capital and scale and access some of the operating knowhow that we've been able to do in a for-profit structure has been a very, very powerful combination.
I can recall talking to parents across the United States when they were looking at a new partner for their district and saying, "This is a company that's been a B Corp certified company since that was an available option for us." I think we were one of the, at least, first 20 or so companies that was a B Corp. And we did that with our board and investors to say, "We're here to change a system and improve a system for kids and families, and we believe that by serving quality values-based meals, we will actually build a valuable, scalable, impactful company that can reach more students in the model that we're in. So from my perspective, I actually think if you build a for-profit company the right way, with the right governance and the right DNA and the right structure, you can actually have an outsized impact on systems.
Eric Ries: Well, I totally agree with that, of course, and yet one of the problems that so many mission-driven companies run into is it's hard for the public and customers and partners to evaluate who's serious about this. How can people know what the governance is, or how do you address that issue as it's come up, as you've engaged with your community stakeholders? How do you convince people that even though a lot of companies have this kind of high-soaring rhetoric about wanting to be a good corporate citizen, that there's something different about Revolution Food?
Kristin Groos Richmond: Well, in our case, our standards that we adhere to from a quality standpoint for students are written into our RFP and bid responses, and we have a very clear list of never, ever ingredients that we do not allow in our food under any circumstances. We are not a company that shifts up and down based on the socioeconomic status of the communities we're serving, and we have a multi-year track record in that. From a business standpoint, we've actually optimized a supply chain and delivery platform based on that so at this point we can deliver that level of quality more affordably than anyone else, debatably.
We write those standards and commitments into our RFP, and the same goes for the Crave surveys that we do with students. We are committing to do a certain amount of consumer-based design, so meaning we are not, again, creating our own what we think are the right menus for the community. We are creating our menus in partnership with the community, and we're committing to that, going in. That's a very important part of who we are as a company, and so we're not just saying it. We're actually writing that commitment into our partnerships.
The other thing I'll say is we believe it takes a village. I think you could probably gather that by talking to us. Whether it's as moms or as CEOs, we believe that food insecurity and quality access to food is a very, very large issue. We're addressing a $20 billion market just in schools alone, and there's room for a lot of players on the public and private side. So when we go in to serve a school district, for instance, we're bringing in nonprofit partners to work with in parts of the model. We're bringing in Food Corp to do food education. We're bringing in programs to do parent cooking lessons. We're bringing in programs that can partner on gardens.
But we also are, I think, humble enough to recognize what we're good at and where community partnerships, many times nonprofit, we have nonprofit suppliers of food in a similar fashion. We know where to complement what we're doing with, I think, the best and most high quality providers in the business, whether for-profit or nonprofit.
Eric Ries: So starting to bring it towards the present, what were your 2020 plans like as the new year dawned? Must feel like 100 years ago now.
Kirsten Saenz Tobey: I mean, I think, like everyone, as we were looking at 2020, that this is the year that's going to mark our 15 years of operating as a company and start the 15th school year of operating. We've been continuing to grow as a company every year and grow at a pretty rapid pace and expanding our impact in communities. So I think we were sort of looking at 2020 as being another year of growth, a year to really make sure that the company was in a place to be, long-term, financially sustainable and to really ... As the company grows, we've invested more in systems and processes and optimization, as Chris said, to make sure that we are able to deliver sort of the highest quality at the most reasonable prices for our partners.
We were, I think, preparing for 2020 to be just another great year of growth and kind of solidification of the foundation of what we were going to be able to deliver to communities for the decades to come. I think specifically we were seeing the opportunity to start expanding, kind of using our platform of fresh food manufacturing to expand into more channels, whether that be sort of convenience store, corner store fresh food or family meals in different forms. So we were kind of starting to think about those things and looking at how can we evolve our model to be relevant to even more kinds of school districts with different kinds of equipment and infrastructure and that sort of thing. But, obviously, 2020 has actually accelerated some of those ideas in some ways and has put others on hold because of the pandemic and everything else that we've been facing over the last couple of months.
Eric Ries: When did you realize the pandemic was going to close schools and effectively shut down all of your customers?
Kristin Groos Richmond: So we started having meetings with our largest partners about the potential of COVID shutdowns I would say March 1st. Some of our larger school systems, Boston and San Francisco, for instance, were, I think, incredibly on the pulse. They're led by really world-class operators, and I think they were very on the pulse of what might be coming, but very little activity across the nation.
So it was a very quick turn. I would say we started thinking hard in March about how to protect our employees. So we issued guidance around how we would think about safety guidelines in our facility, the importance of our GMPs, our good manufacturing practices, many of which cover the sanitation that's so critical for COVID, our deep sanitation processes of our facilities.
Obviously, for all of our employee base, hand-washing and staying home if you had any symptoms. I mean, one of our first thoughts was, "Gosh, we cannot afford to have part of our company, our drivers, our dishwashers, our production managers, our receivers, we cannot afford to have folks feel like they can't stay home if they're feeling like they might be sick or have symptoms. We have to let them know right away that they will not lose their job, that there is a plan to support them if they need to stay home, thereby protecting them and the rest of the company."
So we were starting to do this thinking kind of late Feb, early March, but the speed of the school shutdowns on March 15th I think took the company and certainly the broader nation by surprise with the speed at which they happened.
Eric Ries: What was it like for each of you personally, watching the pandemic kind of roll out and become this global phenomenon and having to deal with the loss of revenue, the need for urgent action? What were those first days like?
Kirsten Saenz Tobey: I mean, I think in those early days, like many people, I was certainly not seeing how long-term this was going to be. I think it was like as each day went by, you started seeing an understanding what was going on at a larger scale. So when schools first shut down, I think many of us thought, "Okay, well, this shutdown could be a couple of weeks. Schools could open back up after spring break, once we get a handle on things."
At the same time, we were kind of shifting the whole mindset of the company from going from what traditionally has been sort of an annual planning cycle where we're talking to schools in the spring about their plans for the fall and bringing that into the form of contracts that last for a full year or up to four or five years. Then all of a sudden, we were shifted into a daily to weekly sort of planning cycle, right, where it's like, "Okay, what's happening tomorrow? What's happening next week? What do we know is happening the week after that?" Then beyond that, we have no idea.
So, I mean, at least for me personally, it was this kind of day-by-day recognition that this kind of week-to-week planning is actually the new normal. It's not like, "Okay, well, let's get through these couple of weeks and then we'll start to see normalcy resume and we'll go back to an annual planning cycle." At the same time, on the personal side, with our kids' schools shutting down and all of a sudden having three kids distance learning from home and my husband and I both working from home, that shift has been challenging on so many fronts as well. But I think just on the personal front as well as on the work front, we've started to recognize this isn't changing in weeks or months. This really is something that we have to figure out how to kind of get to a level of sort of sustainability on how we're going to operate.
Kristin Groos Richmond: I would say for me, I was very, very concerned in the first ... I would say from March 10th through March 20th, I don't think I slept at night. I was probably most concerned about the students we serve. We know roughly 75% of the kids that we serve, and that's pre-COVID was 2 million meals per week, breakfast, lunch supper. 75% of those kids rely on school meals as a primary source of nutrition.
So it's not like a nice to have, "Maybe I'll pack my lunch. Maybe I won't." No. It is "I am going to school, where there's a reliable source of nutrition and it's something that I count on and my parents count on." So there was a huge, huge amount of fear that I felt around that. I think the second order of business was "What is going to happen to Revolution Foods?" I mean, we support roughly 2000 employees across cities in the US. Our parents we serve often are our employees. So we've got full families and community members working for us that are also family consumers of our product and our schools.
Like most food companies, we weren't running on an enormously cushioned margin and cash balance. So when you lose 50% of your business over the course of a week and you're not sure how you're going to build it back up, that is beyond concerning. I think for me, I was maybe paralyzed for a couple days there. "Just how are we going to respond?" Then once we as a team and as an investor and sort of ecosystem of stakeholders got our plan together, and a big part of that was our incredible school partners, who said, "We are going to feed as many kids and families as we can," sort of dam the torpedoes, a couple days later, within a week, we were building at light speed what would be the next iteration of Revolution Foods and our feeding system. From that point forward, it's been kind of sheer momentum and adrenaline. So that probably describes my journey fairly well.
Eric Ries: It sounds incredibly intense. I was talking in one of these conversations with Brian Chesky, who talked about the collapse of revenue and the dramatic effect that this had on Airbnb. He described it almost like a second founding, like you have to found the company all over again. It's a new product, new world, new economic reality. Was it like that for you, too?
Kristin Groos Richmond: Yes. Without a lot of runway, and I'm sure Brian felt the same, but, I mean, for us, I knew our runway was short and I knew our consumers were incredibly reliant upon the product. I would say the most motivating and inspiring thing that has happened at Rev Foods, and that's saying a lot, because there have been a lot of inspiring ... There have been a lot of hard days and a lot of inspiring days over the last 15 years. But at one point, I can recall a huddle, because we started doing team meetings every single day at nine AM and three PM Pacific time, and we said, "It is more important than ever that our team hears from us and that we are together in this. We are together in the ups, we are together in the downs, and we'd rather just put it all on the line."
At one point, very shortly into COVID, I can recall a very lovely team member saying, "Let's be honest. The fear of food security, the threat of food insecurity in our communities is far greater than the threat of COVID, as serious as COVID is. So let's get to work, people. We have families to feed, and we cannot afford to miss work." So that really has been the rally cry, and then, of course, the intensity of keeping the team safe, because feeling a tremendous responsibility to our team, who has worked days, nights, weekends, holidays, there has not been a break because of this rally cry of making sure that no family goes hungry on our watch, if we can avoid it.
Kirsten Saenz Tobey: I would just add I think that that concept of the second founding is a really interesting one that this is, in some ways, a moment of rebirth. The big difference is ... and, of course, we have so many amazing stories from our early founding days of working through challenges. But the difference is that today we have this incredible team of people all across the country who are going through this with us together, and the amount of sort of innovative energy and intellectual capacity and problem-solving ability that we have on this team across the country is 1,000 times greater than what we had in 2006, when it was just a few of us in a kitchen, right, in terms of how quickly can we solve problems? How quickly can we develop new ways of working on things? Plus, we have the whole foundation that we've built over the last decade and a half. So how can we use this platform?
Just seeing the problem solving happening in each of our regions and with each of our leaders across the different teams to say, "Hey, I talked to this community organization that's trying to get food to people in X, Y, or Z setting. Hey, the city of New York is trying to get food to homebound people across all five boroughs of New York, and they want to leverage their 12,000 underemployed taxi drivers to do it. Can we make this happen?" It was like over a couple of weeks, we put together a plan to make it happen. That wasn't Kristen and I putting together the plan. That was our incredible team of operators and partnership team members in the New York and New Jersey region. So I think having this incredible team that's working together on the reinvention and the regeneration of this next chapter just is so inspiring and motivating to all of us.
Eric Ries: In the conversations that I've been having and the relief work that I've been doing, I feel like there is still this sense, frankly, of denial about the tsunami of need that is going to crash over us as the human and economic devastation of now multiple crises come to fruition. And hunger is really one of the most basic needs that our food security system struggled to deal with even before the crisis, and now it's about to get potentially tens of millions of people worse.
So talk a little bit about... What have you encountered, what have you seen, in terms of raising people's awareness of the scale of the problem and, therefore, the scale of the solutions? And what do you think all of us should be focused on right now as we try to reconstruct the foundations of our society to cope with this?
Kristin Groos Richmond: Well, I'll give a couple anecdotes, and I think Kir and I both have a few very key policy recommendations that I'll let her speak about. We are seeing families and individuals line up at 3:00 AM and wait eight hours on a daily basis to collect food; whether it's at food banks or whether it is at school feeding sites across the country, from San Antonio, Texas, to where I'm from, to New Orleans, to New York City, to Oakland. So there's absolutely no doubt that the need is enormous. And I think everyone is trying to do the calculation of, "Okay, does reopening equal people coming back to restaurants, back to stadiums, back to airports, back to the spots where the majority of the 30 to 40 million people who have lost their jobs in the U.S. Work?" And I think the general consensus of those of us who are closest to food in those spaces is no.
There's a recent statistic that says that only 35% of Americans will go back to restaurant dining this year, and 50% of Americans will not take an airline flight until 2021, at the earliest. So think there's some pretty clear data now that says that a reopening does not correlate directly to these jobs coming back right away and that about 50% of the job loss is likely to be persistent job loss, which means that as a country, we have to continue to double down on food security as an issue. There's also a common acknowledgement that when a person or a family misses three meals, that is one of the highest indicators towards social unrest.
And so both from a compassion for our communities and an overall safety and security standpoint, no matter which way you look at it, we have to double down on ensuring that there is a safe path to recovery for millions and millions of Americans who did not expect to be here today. And that involves some really smart policy and continued efforts of people who are... We know that food banks and school districts, frankly, have been absolute central hubs of feeding across cities. These folks have been doing this for months at this point, and there's a lot of exhaustion and there's a lot of budget pressure. So the imperative to act in a smart way has never been higher. And I think, Kir, you can share a couple of the key policy recommendations that we believe are critical to kind of get through this time in a safe and stable fashion.
Kirsten Saenz Tobey: Yeah. I mean, there's clearly a big need for a public safety net around food and a bigger safety net than we currently have because of the food insecurity that will be incredibly persistent along with the joblessness that we all see currently and the very slow economic recovery that I think is likely to happen over the coming months and years. And so there are a few kind of specific things from a policy standpoint that are important just for, sort of, stability of the current food state safety net. The USDA has been putting out waivers that have been incredibly helpful for schools to be able to continue serving kids even with schools shut down. So those are waivers around meal service times, meal pattern requirements, ability for weekend meals to be reimbursed, ability for multiple days worth of meals to be distributed at a time to students and families.
And all of those waivers currently have only been extended through the end of this summer, where I think most people realize that come September, we're not going to be back to complete normalcy. So I think one really critical thing is just to have... The USDA needs to just recognize that those waivers need to be extended through the entire next school year, whether or not schools need them. They may not need to use them, but to... it's critical for schools to continue to have the freedom to distribute meals in the way that they currently have been because we know that school is likely not to be completely back to normal in the fall. I mean, we also think that even with the, kind of, economic collapse schools will continue to be an important hub for food distribution partly because students may be going to school, at least occasionally in the fall, but also because schools are sort of trusted and centralized community hubs already.
And it's important, especially as people are hesitant to go out and about too much, that schools can continue to serve the important need that they have been serving in providing a place where families can pick up meals a couple of times a week and bring them home. But we think that it's really important that meals be available and funded, not just for students as they currently are, but also for entire families. Because what we know now is that meals are being taken home by... intended for just for students and kids, but entire families are hungry. And so the food that's being distributed is not enough to ensure food security for everyone who is currently suffering and who will continue to suffer from hunger and food insecurity.
So we want to see those, those waivers continue. We want to see new sources of funding for family meals. We do think that there is a big place for philanthropy here that... Unfortunately, philanthropy is sort of the next source that's out there when there are gaps in what the government can provide. So I think it is critical for philanthropy to step up, not just for relief feeding in the next few weeks and months, but to actually think about longer term commitments around feeding families so that those gaps can be filled.
Eric Ries: What are the most impactful things that philanthropic dollars could be going towards right now?
Kirsten Saenz Tobey: I mean, from a food security standpoint, I think it literally is food. It's that there's a need to get food, whether it's prepared meals or family meal kits, out to families that need them the most.
And that clearly is... it's a bandaid solution, to just get food into the places where people are hungry. But I think that is important while we try to rebuild the economy. Actually getting food into people's kitchens and into people's homes is probably one of the most important things to ensure continued both social stability, health stability. And ideally, that will also contribute to people being able to contribute economically in the longer term.
Eric Ries: It has a historical parallel to me going back to the WPA where in depression circumstances, you have a credible number of people who are unemployed or underemployed at the same time that you have massive social needs far beyond what a market-based solution can quickly enough deploy. And we have to use philanthropic and government dollars to fill that breach, to put people back to work, and in this case, to feed the hungry.
And yet, I've had so many philanthropists that I've pitched this to over the past, I don't know how many months it's been now, who it's almost too simple for them to want to do it. There's no complicated theory of change. There's no 10-step program. It's just we need to turn money into food and feed it to people right now.
But on the flip side, this is one of the few truly scalable things you can do with philanthropy. There's only so many virologists and science labs, and they should be fully funded of course. But the next marginal dollar, you start to hit diminishing returns. Whereas with this hunger catastrophe, I wish it wasn't so, it's a tragedy that it's so, we can put almost unlimited dollars to use and we can make an immediate humanitarian impact incredibly fast.
Kristin Groos Richmond: That's right. And what I would say is with any crisis situation, there are a few silver linings. And a couple of the silver linings that have happened here in this world of food security is the innovation that's happened around city-wide distribution around, again, just I can't thank enough the schools out there who have become central feeding hubs for the community. And the infrastructure right now is there to provide to families. The innovation has happened very, very quickly.
I mentioned in New York City, we're dropping off 100,000 meals, and miles of taxi cab drivers are lined up to distribute these meals door-to-door to families. So in Boston, bus drivers are delivering meals to home-bound families throughout the city who are food insecure. So there's a lot of infrastructure right now that is allowing for scalable food security. And so we need to keep that going and leverage off the progress that has already been made and is set up.
And so, to your point, this is something we can build off of and keep going in a highly efficient way.
Eric Ries: What can people do to help right now? If there's anybody listening to this who's been inspired by your story and they want to be part of this fight against hunger in this era of crisis, how can they help?
Kirsten Saenz Tobey: Well, I would say there's a couple of things people can do to help. First, if there are either schools, school districts, or community programs in your community that need support in getting high quality food out to their families, they can certainly reach out to us. We have capacity to expand what we're doing. And particularly, if there's a need for safely packaged, unitized meals, we can certainly support schools and community programs with our wide array of food options.
I think if people have money to donate, they can donate to our non-profit Feeling Good Project, which is a fund that we've established where philanthropic donations can be turned directly into meals that we distribute to families in need. And so we can provide the link to that if folks want to donate directly.
Eric Ries: Yeah, we'll put a link in the show notes and definitely encourage those who are able to donate.
Kristin Groos Richmond: There's another group that I'd like to mention, World Central Kitchen and Jose Andres, who are doing just incredible work, too. We're working directly with them. They're also doing incredible work to revitalize restaurants and make sure that local restaurants are able to produce and feed in that local capacity as well on the adult meal side. And so they're pretty well-known now, but there are some great organizations doing work out there, The Red Cross, Share Our Strength. So very good partners in the community right now working very hard on this.
Eric Ries: All right. I want to make sure we get that call to action in. So finally, where do we go from here? How do we get out of the crisis?
Kirsten Saenz Tobey: Good question. I think what's going to get us out of this crisis is as a combination of confidence, public health intervention, and all of that while maintaining stability in that sort of Maslow's hierarchy of needs of which food, water, and shelter are the most basic. And so I think we see our role in that as let's make sure that food is not the limiting factor for folks and for economic recovery and for health recovery. We're clearly not going to solve the health situation in terms of what it's going to take from a public health standpoint to eliminate the pandemic from our country and the world, but I think we can do our part to make sure that while we're working through the public health side of things, that people's basic needs are being met through high quality food being reliably available to everyone who needs it.
Eric Ries: I want to thank you both for your work, taking care of those who are in need, and setting an example for how companies can be a force for good in this world. It's been an honor and a pleasure to be on the journey with you and especially to see you work with such urgency and just Herculean effort, your whole team really, in this time. So thanks for taking time out from that much-needed work to share the story. I just really appreciate the conversation.
Kristin Groos Richmond: Thank you so much, Eric. We appreciate being on the podcast and the recognition for the work and the need out there. So we appreciate you.
Eric Ries: This has been Out of the Crisis. I'm Eric Ries. Out of the Crisis is produced by Ben Ehrlich; edited by Jacob Tender and Sean Maguire; music composed and performed by Cody Martin; posting by Breaker.
For more information on the COVID-19 crisis and ways you can help, visit helpwithcovid.com. If you are working on a project related to the pandemic, please reach out to me on Twitter. I'm at E-R-I-C-R-I-E-S. Thanks for listening.
