Milking A Big Idea
Beating the odds wasn’t always second nature for Gary Hirshberg, co-founder and CEO of Stonyfield Farm, the yogurt company based in Londonderry, N.H. In its first nine years of business, Stonyfield lost money every year.
“For the longest time, my wife couldn’t understand,” he recalls. “For every cup of yogurt we made, we lost money. She never understood why we wanted to keep making more yogurt.” But Hirshberg’s persistence paid off . Today the trailblazing company, boasting $150 million in annual revenue, is the third-largest yogurt brand in America and a leader in the organic revolution.
When Hirshberg partnered with agricultural pioneer Samuel Kaymen in 1983, the pair set out to produce yogurt and dairy products in a way that would benefit family farmers and the environment. “We started with a big idea, a big dream,” he says, to build a successful values-based business that put sustainability first – a novel concept at the time.
“To be honest, we were very naïve and didn’t know what we were getting into,” he says. “We were just a couple of crazy, idealistic guys who believed in the power of business to do good.
“We were launching at a time when the notion of organic was very foreign, if understood at all,” he adds. “We were leading a lot more with our hearts.” He was determined to make people conscious of the global impact of everyday decision-making.
“I really believe that when you purchase items at the supermarket you’re voting – for local or not, natural or not, environmental or not,” he says.
Customers have responded passionately to both the product and the philosophy. “It really stirred people to write and communicate and get in touch,” says Hirshberg. “The more we sold, the more demand there was.” While Stonyfield didn’t have a competitive marketing budget, he explains the company’s core values resonated with people: “What we learned is that Coke and Pepsi might spend a lot on advertising, but they don’t necessarily buy loyalty.”
Hirshberg says creativity was also key to the yogurt maker’s survival. In its inaugural year, the Stonyfield team conceived a promotion dubbed “Have a Cow.” If a customer sent in five lids, they would get to “adopt” a cow, getting correspondence and a photo from their designated cow. Joan Rivers and Al Gore were among the first to participate. “Our mission generated a lot ofextra attention for us,” he says. “We didn’t necessarily have to play the game the way the big guys did.”
Stonyfield has steadily increased its philanthropic and community efforts. Through its Profits for the Planet Program, the company donates 10 percent of profits to environmental causes and has donated in excess of $1.6 million to date. The Environmental Protection Agency and other green councils have recognized Stonyfield for its innovative recycling and energy conservation strategies.
Even after Groupe Danone bought the majority of Stonyfield stock in 2003, Hirshberg contends the company retained its integrity. “We made our mission inseparable from our company,” he says. “They bought into a values proposition. They realize that because we were organic, we brought intellectual capital. And it was still worth it even if the price of entering was dealing with an independent, stubborn, painin- the-ass entrepreneur.”
Hirshberg contrasts his independent streak with the traditional paradigm. “Most business people, truly in the classic B-school training, don’t factor in things that can’t be measured in quarterly terms,” he says. “That’s a big problem – because the planet doesn’t operate in quarters.”
He points to mounting environmental issues such as acid rain, global warming and overpopulation: “These are things that took us generations to get into and we’re not going to solve them on a quarterly basis.”
Hirshberg credits his mom with teaching him the importance of tenacity. A single mother raising five children in rural New Hampshire, she didn’t baby the kids. “If one of us fell down or there was a problem, her thing was just, ‘Dust off and get going.’”
“I think determination is the most undervalued but essential entrepreneurial attribute,” he states. “People often say, ‘Oh, you need to be smart. You need this, you need that.’ But if you’re not determined, it’s all academic.”
Hirshberg doesn’t spend his time reflecting on the past. “It’s the role of the CEO to be looking over the horizon at what’s coming next,” he says. “It’s our responsibility to see beyond, to try to predict and then, of course, try to motivate people to join you in whatever crazy idea you’ve got.”
And what crazy notion might be next? Saving the planet is high on Hirshberg’s list: “As proud as I am of what we’ve done, particularly from an environmental perspective, there’s just so darn much to do.”