Jason Del Rey

Recent Posts by Jason Del Rey

Subscription Snack Startup NatureBox Adds Popchips CEO and Former Netflix CFO to Board

NatureBox founders Gautam Gupta (left) and Ken Chen

If subscription snack service NatureBox is going to become a breakout success, it’s going to need to surmount two big hurdles: Creating efficient operations systems that can support customized monthly shipments, and building a brand that stands out amid the snack-food masses.

It’s betting that two of its new board members — Keith Belling, co-founder and CEO of snack-food brand Popchips, and Barry McCarthy, the former CFO of Netflix — can lend expertise on those challenges.

NatureBox, founded in 2011, makes what it describes as “healthy” snacks — such as salsa-spice nut mix and orange granola — and ships five different ones each month to subscribers for $19.95. Right now, NatureBox customers can’t choose what they want in each box, but co-founder Gautam Gupta said the company is getting the systems in place to allow for customization.

“The idea was to start with discovery, really get consumers associated with the brand and quality of products that we’re sending and then allow them to replenish their favorites,” he said in an interview last week.

But that shift to customized or personalized, boxes, which Gupta said should roll out by year’s end, will be a logistical headache. How much inventory of each product do you carry when you don’t know what a customer will want, month to month?

That’s one reason why Gupta is excited to have McCarthy as a board director.

“A lot of the challenges that Netflix managed through, especially with the DVD business, was very similar,” Gupta said. “We’re obviously building data and forecasting systems that would allow us to plan for that. We’re also building functionality that would allow a customer to plan shipments in advance: Set it and forget it.”

But that internal challenge is just one part of the equation. On the external brand-building front, Gupta intends to lean on Belling, who has grown Popchips into a snack business that reportedly does nearly $100 million a year in revenue, but not without some bumps along the way.

Gupta won’t disclose revenue, but said the company will sell more than one million boxes this year. At $19.95 a box, that would mean revenue of at least about $20 million, though the startup does often offer discounts to lure new subscribers.

NatureBox has 45 employees, and has raised $10.5 million from investors including General Catalyst, where Gupta previously worked, and SoftBank Capital.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik