Secrets of a Serial Entrepreneur
Entrepreneurs beat long odds when they launch a company, scale it up and sell it to investors. Jason Cohen ’96 has done it five times in 15 years.
“A lot of people will tell you that the way I worked, I basically worked to 100 years old. But I did it in 15 years,” says Cohen, who recently gave back to the Smith School in the form of a lead trust that benefits the Dingman Center for Entrepreneurship.
The decision to be his own boss came early at the Smith School during an introductory business course. “The professor explained that Maryland produced a lot of great entrepreneurs,” says Cohen, who came to the University of Maryland from his home in northern New Jersey because he liked the location, the fraternal system and the sports traditions.
He earned a marketing degree and then sold insurance in New Jersey while looking for his first opportunity. That’s when he noticed that gas stations and convenience stores — scrambling to keep up with the spread of Starbucks — needed some kind of breakfast snack to package with the coffee they were selling to morning commuters.
He cofounded Mamma Says in 1999, filling the market gap with tasty biscotti. “Mamma Says was my education out of school, where I made every mistake known to man,” Cohen says. “But passion and heart kept driving us to succeed.”
He sold the business for four times its revenue in 2005 and moved quickly to his next project, World Gourmet Marketing. The startup’s flagship brand, Sensible Portions, rode a wave of demand for all-natural, low-calorie snacks such as Veggie Straws, Pita Bites and Multigrain Crisps.
Costco, BJ’s, Walmart, Sam’s Club, ShopRite, Safeway and other outlets put Sensible Portions on their shelves, driving revenue from $0 to $100 million in five years and earning a sale price of $110 million. “We lived and breathed that brand 24 hours a day,” Cohen says. “We had great employees and a family atmosphere.”
More recent multimillion-dollar successes have included Rickland Orchards yogurt, SkinnyPop popcorn, Dippin’ Chips party snacks and Mrs. Thinsters cookies. Every sell-off leaves Cohen with mixed emotions. “It’s like watching a child grow up and sending him off to college,” he says. “You feel a sense of accomplishment, but at the same time you have to let go.”
During many of these ventures, Cohen has worked to keep the same core of about 10 people together. “Once you have a great, winning team, you can create anything with that magic,” he says.
Rather than starting new projects from scratch, the team now focuses on identifying high-potential startups that need capital and expertise to grow. “We invest in businesses and provide leadership skills,” Cohen says. “When these opportunities come, we have the team in place to be able to execute.”
The model already has worked with SkinnyPop, which grew five times its size in 13 months to $150 million in sales. More recently, Cohen’s team has turned its attention to a beef jerky company called Chef’s Cut. “We’re creating jerky fans,” Cohen says. “It taste like steak in a bag.”
He says his team will not dilute its attention with too many deals. “If we invest in your business, then we believe it can be a $50 million to $100 million business,” he says. “And you’ll get a roadmap from an entrepreneur who has been in your shoes.”
Part of that roadmap includes the following seven secrets of Cohen’s success.
Secret 1: Don’t Wait for Permission
Society frowns on impatience and stubbornness, but variations of these traits have driven Cohen throughout his life.
When he was a child, his parents refused to buy him the bicycle he wanted. So he took his baseball cards and started selling them on the school bus until he had enough money. When his friends idled on the weekends, he planned ski trips and social events to bring them together. When freshmen arrived at UMD unsure how to begin their college experience, he walked up and down the dorm hallways selling school T-shirts and making connections.
“I’ve always been impulsive and impatient,” he says. “I innately found ways to create opportunities.”
This mindset causes friction in corporate America, where people want multiple meetings and signoffs before they do anything. “They don’t necessarily like being pushed to accelerate their growth or to try new things or to streamline things or allow people to make decisions on their own,” he says.
Entrepreneurs act fast to seize opportunity. “If you have to ask other people’s advice, then you’re probably not an entrepreneur yet,” Cohen says. “An entrepreneur just knows that there’s something missing, and there’s an opportunity.”
Secret 2: Put Yourself Second
Every entrepreneur starts with a vision, but the good ones find ways to be contagious. “To get people to do extraordinary things, you have to incentivize them or get them to buy in to your vision,” Cohen says. “My greatest accomplishment is making other people feel that what we create is something of theirs as well.”
Often this requires entrepreneurs to put themselves second. Cohen says he spent many sleepless nights, especially in the beginning with Mamma Says, when he was paying others but not himself.
“You have to have the mentality that at some point you will get overpaid or over-rewarded for those sacrifices,” he says. “But you’ve got to have the stomach for that. You’ve got to put yourself second and other people first.”
Secret 3: Don’t Invest Like a Doctor
Most new entrepreneurs look for capital anywhere they can find it, but Cohen says taking money from the wrong sources can sink a startup. That’s because money buys influence, and entrepreneurs can find themselves beholden to investors who don’t understand a particular industry.
“I see a lot of people doing what their investors want them to do,” Cohen says. “They listen to too many people, and then they go off in too many directions.”
When Cohen sold insurance, he met many doctors who fell into this trap. “Doctors are most susceptible to investing in things they don’t know,” he says. “They were always telling me about this hot concept they invested in, but the only ones that came to fruition were things related to the medical field.” He says the best strategy is to invest in what you know.
The same principle applies when thinking about the right time to sell a company. Cohen and his team know how to grow a startup to $50 million or $100 million in sales, but then they let others take control. “That’s our sweet spot,” he says. “That is where we understand the businesses the best.”
Secret 4: Ask the Soccer Team
Some companies test new products with focus groups and surveys, but Cohen has found success with a less scientific method. “I would bring home new products to my kids,” he says. “Kids are brutally honest.”
If his daughters approved, he would take more samples to their next soccer game and watch the reaction. He challenges retailers to do the same thing when they evaluate his products. “Take it home,” he tells them. “If your kids like it and ask you to bring it into the stores, then we have a winner.”
Secret 5: Go Mystery Shopping
Cohen gathers additional market intelligence every time he shops. “My wife hates sending me to the supermarket because I can spend hours there,” he says.
Sometimes he watches covertly. Other times he approaches strangers and asks them why they put certain items in their carts. “People will think I’m crazy,” he says. “But you get a lot of great information from those people that will stimulate new products, flavors and packaging.”
He has similar conversations with store executives and managers. “Retailers want to be successful, and they’re tired of the big guys coming in and telling them what they have to buy,” he says. “When I go into meetings to sell my products, I am asking more questions than I am telling. I go in there with the attitude of, ‘What do you want to see on the shelves?’”
Secret 6: Find Strength at Home
Entrepreneurs must think about their families when assuming risk and making commitments. “Your family needs to buy into you as well,” Cohen says. “Without them I couldn't do what I do. I've seen too many people make mistakes because their spouses weren't confident in their choices.”
He frequently credits his wife, Jamie. And at company parties, he thanks his team members’ spouses. “Make sure before you start your journey that your family is all in for the ride,” he says. “It’s a bumpy one with lots of emotions and balancing acts.”
Secret 7: Find Your Purpose
People need money, but Cohen says successful entrepreneurs find higher purposes. “An entrepreneur is someone who wants to take a lot of pain for the opportunity for ultimate reward — not only for themselves, but hopefully they’re doing something that’s going to help others,” he says.
His purpose is to change the way people eat while inspiring future entrepreneurs. “I wanted to create healthy foods,” he says. “I also want to give back to people.” /DJ/