This guy built a $10 billion empire on spoiled milk.
It all started with a $800k SBA loan.
The best bootstrap story you've never heard of 🧵
Meet Hamdi Ulukaya.
He grew up in Turkey.
His family was sheep herders, dairy farmers and feta cheese makers.
As a young student, he was questioned by police about his support of the Kurdish-rights movement.
He had to leave Turkey.
His friend recommended America.
But he was taught "capitalism was the reason for the suffering of poor people"
His friend told him “Don’t be stupid, go to America. Learn English.”
So that's what he did.
Hamdi got a job on a farm in Upstate New York.
He loved America but missed good cheese from home.
When his Dad visited he had the idea of making cheese with an old family recipe.
So together with one of his brothers, Hamdi started a cheese company in 2002.
They sold some cheese but were barely breaking even.
The cheese was great, but the demand wasn't there.
One day he got some junk mail:
An 80-year-old Kraft yogurt and cheese factory was for sale.
For only $700,000.
This was a fire sale.
Many of the individual machines would cost more than a million if bought new.
He had to have it.
He wrote a business plan and got 90% financing from the SBA.
With local development grants to fill in the rest.
The factory was his.
But he found one big issue after closing.
They were missing a separator.
Basically, an industrial washer-dryer that removes the milk solids from whey.
Those cost $1 million brand new. He didn't have the money.
After searching for months, he found a used one for $50k in Wisconsin.
On his drive there, he came up with the perfect name for his new yogurt:
Chobani
From the Turkish word Coban meaning shepherd.
It took him 2 years to perfect the yogurt recipe.
Consistency and flavor had to be right.
Creamy and not too tart.
He hired back many of the laid-off workers from the old factory.
Then he had to nail the container design.
Hamdi wanted the design to be different.
American yogurt had a narrow opening.
He went with a wide squat container like European yogurt.
He called it Greek because that was becoming popular.
And colorful cups to stand out.
Hamdi was ready to launch.
But he didn't want to be stuck in specialty stores.
He went straight for the biggest grocers.
He didn't have the cash to pay for the usual promotion. So he offered stores more yogurt.
It was an instant hit.
Over the next 5 years, they grew faster than Facebook or Google.
Hamdi lived in the factory.
His staff pulled all-nighters to keep up with orders.
By year 5, they had $1 billion in sales and 50% market share in the Greek yogurt market.
In 2016, Hamdi Ulukaya granted his then 2,000 employees roughly 10% of the company.
With a rumored valuation of $10+ billion, this works out to be about $500,000+ per employee.
With many early employees set to take home several million.
Many of them are factory-line workers.
Today Chobani is rumored to be thinking about an IPO.
Their sales have surpassed $2 billion and they continue to grow 20%+ a year.
Hamdi with his employees still own about 90% of the company.
Takeaways:
Creative Financing: Hamdi started with a government loan & local grants. He grew faster than VC-backed co's.
Unfair Advantage: Hamdi combined his family knowledge with his operations savvy.
Move Fast: Hamdi saw an opportunity & jumped before large companies woke up.