Subscription Service Love With Food Helps Gourmets Discover New Treats

9/27/12Follow @xconomy

When Aihui Ong, founder and CEO of Love With Food, a Birchbox-style food subscription service, was applying to the incubator 500 Startups last fall, she wasn’t too optimistic. She believed in her company, which she had conceived as a sort of Groupon for small food producers, but she knew that she faced tough odds as her company’s sole founder.

“A lot of people in Silicon Valley don’t like the idea of a single founder,” she says. “Starting and launching a business is tough. They think one person can’t do it all. But there are data anomalies.”

When she pitched her company to the accelerator, they told her that of the 250 companies that had gotten funding, only seven had a single founder.

But she wasn’t fazed by the stats. Before founding Love With Food, she’d spent eight years as a software engineer, mostly working for financial companies. And it was boring. “Counting other people’s money is really not fun,” she says. “My passion is food. ”

So she quit her job and took a year off, planning to attend culinary school after she returned from backpacking around the world.

But when she got back, things had gotten complicated. Her best friend was diagnosed with breast cancer at age 33, and as a fellow immigrant, she didn’t have family in the States. “I told her, ‘I’ll take care of you, I’ll cook for you while you’re under chemo and radiation,’” she says. “I know how to show love with food.”

The contents of a typical box from Love With Food.

The contents of a typical box from Love With Food.

At the same time, another friend in the food industry was thinking of shutting down her business. While she was having great success selling her stir-fry sauces at local farmer’s markets, she was having a really tough time getting her product in grocery stores. “Getting on shelves at Safeway or Whole Foods is really difficult,” Ong says. “Middlemen get involved and you lose margins.”

So she skipped culinary school in favor of starting a company with a mission to help small food producers get their creations into the hands of foodie consumers looking for something new.

Ong built a site, chatted with entrepreneurs at farmer’s markets, and started her business, offering specialty products online for a discount. One day while checking out new foods at the farmer’s market, she realized she should market the delicacies the same way food trucks and roadside stands do: with free samples. She told producers, “’I’ll lick every stamp and send them out to our members nationwide,’” she says. “A lot of people just want to know if you like the taste, the texture, the packaging. It went really well. The first instinct after people tried it was, ‘It tastes good, where can I buy it?’” Ong also promoted Love With Food online by creating a Facebook page. It was a simple move, but she managed to get a whopping 90,000 fans.

And those fans got her in the door at 500 Startups.

She may have been a single founder and a software engineer, but she was also great at marketing. The accelerator took a chance on her, and Love With Food came out of the Fall 2011 class with a new business model. Instead of just selling products online, Ong pivoted to a subscription model, sending out samples of the same specialty foods entrepreneurs sell through her website, often at a discount. The move was about the numbers. “I don’t believe I should just build a feature because I feel like it,” she says. “I should only do it when I have data to prove it’s something people want.” But testing showed that people were very willing to sign up for monthly treats.

Now, for $10 a month, subscribers get a taste of about 10 different items. For every sale she makes—whether a subscription or a bag of hemp seeds or Bone Suckin’ Sauce or Earth Family honey—the company donates free meals to people in need. Donations from subscriptions go to the charities Feeding America and Share Our Strength; specialty food makers can choose a local food bank to send the funds to. Since launching publicly in January, Love With Food has provided 13,440 meals to people in need, Ong says.

In July, Love With Food announced the company had raised a seed round of $645,000, led by Justin Kitch, founder of Homestead.com. It’s also grown from Ong’s one-man band to an operation of five and a half employees that’s about to grow by one more.

For Ong, building up Love With Food is a way to disrupt the $56 billion American food market. “When we go to food shows, they really love us,” she says. “The don’t have to go through brokers or distributors anymore. When they hear it’s nationwide, their eyes light up.“

It’s also a great way to prove the single founder naysayers wrong. “Being a single founder was sort of an obstacle,” she says. “But now, no one really brings it up anymore,” she says. “I’m glad people have the faith in me that I can grow the company by myself. And I have a great team building with me.”

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