Healthybud’s Journey Through Risk, Resilience & Growth with Kyle Feigenbaum

Mike Pinkus: Over the last 10 years at ConnectCPA, we've had the privilege of witnessing the incredible journeys of over a thousand businesses. We've been there for the thrilling highs and daunting lows of entrepreneurship. We've celebrated wild successes and monumental exits, and we've also stood by businesses as they've navigated the stormy seas, facing roadblocks and challenges that every entrepreneur encounters in their day-to-day grind. Join us as we dive deep into the stories of these resilient individuals who dared to dream, who persevered, and who were a testament to the power of entrepreneurship. This is their journey, their lessons, and their triumphs. Welcome to GrowthTales. I'm your host, Mike Pinkus, co-founder of ConnectCPA. Today we've got Kyle Feigenbaum, who is the co-founder and CEO of Healthybud, which is a pet wellness brand that's raising the bar in dog nutrition. They do everything from superfoods to treats to chews, all with the goal of helping your dog live longer and happier lives. Thank you so much, Kyle, for joining me today.

Kyle Feigenbaum: I'm sure, Mike. Great to be here with you.

Mike Pinkus: I wanted to kick it off by saying I'm a big fan of your brand. I know we've been working together for a little while now. My wife grew up with a dog, which lived to, I think, about 17. It was a Shih Tzu. I hear all the time that dog nutrition and keeping your dog healthy is like a family member. So I want to start off by asking a little bit about your background and how you got into the business of dog wellness and nutrition.

Kyle Feigenbaum: Yeah, it's not a simple path forward, like some entrepreneurial stories, but for myself, I've always been fascinated with building something out of nothing. My first experience with that was in university. Me and my buddy in college started a note-sharing platform called Study Well. At the time, we were running this on WordPress with WooCommerce plugins—this was well before Shopify. So we were getting nerdy with it. The idea was to collect notes from various different courses and colleges, compile those notes in a very easy format, and sell them back to students so they could improve their study habits and prepare for exams better. We did that, it lasted about two years, and we tried to pass it on to the next generation.

It just didn't sort of click after graduating, but during that time, it was really working well. I mean, we were doing probably $10,000 to $20,000 in revenue a month, and this was on 80 to 90% profit margin. We were young—I was probably 20 years old—so you can imagine, this was really exciting for us. I think the most exciting part about it was that when we went and studied for our own exams, we'd go to the public libraries and look at people's computers as we were walking down the aisles, and we would see people on our own website. That was amazing—to see that we'd built something from nothing that people were using. That was really my first go at entrepreneurship. That didn't last too long.

Kyle Feigenbaum: It lasted until I graduated, at which point I went into finance—which is a whole other story—and eventually rolled into the pet industry. The pet industry was very random for me. The one thing that I could say is that I've always loved my dogs. I've always grown up with a dog, which is not a reason why you should start a business, but for me, it was an interest in the business.

I actually randomly attended a trade show in the pet industry in Orlando—it happens annually—and I was amazed to see how massive the industry actually is. What I took away from it is that it's huge, there are so many different brands, but I felt like there was a void. Something was missing because I really didn't feel attached to any of the brands that I saw or met or felt like I wanted to purchase from them.

So I thought there was a real opportunity in that. Not long after coming home from the trade show, my family dog passed away—very suddenly. She went from being, in my eyes, perfectly healthy one day, to wobbly on her feet, falling down the stairs, me picking her up because she was not able to stand, her sleeping through it, again not able to stand the next morning, me calling my mom, us going to the vet together—the vet diagnosing her with hemangiosarcoma, a very aggressive form of cancer. She basically went from what I thought was healthy to not being able to breathe in a very short period of time.

What that pushed me to realize is that the pet food industry, even now—but especially at the time—was not set up for our dogs to thrive. Most dogs today are eating a highly processed kibble diet that is stripped of all nutrients, and that is not allowing our dogs to get the nourishment they need to live a long, healthy, and good life. That's where we came up with this idea to become the next-generation pet wellness brand and to provide real, high-quality, healthy foods to our dogs. And here we are today, five years later.

Mike Pinkus: Wow. So you mentioned—I want to dive a little bit into—well, first of all, let me ask you about the actual products themselves. Is the thesis that you have similar to humans, in that if we eat healthy, as we get older, the risk of everything that could go wrong just goes up exponentially? But I guess in humans, if you eat really cleanly and you exercise, you do all the right things, it might delay the onset.

So when you had that situation with the cancer with your dog, were you thinking that if you helped on the nutrition front, there might be some inevitable things that could happen, but you might extend the lives of pets? Is that what you were thinking? Or what were you thinking?

Kyle Feigenbaum: I'll give you a personal story. I mean, that's twofold, right? Because the opposite is true too. As a human, we can eat McDonald's every day, twice a day, for the rest of our life and probably be living. But then the question is, are we really feeling good on a day-to-day basis, and are we thriving? That's kind of how I think about a highly processed diet for our pets. They can live on it, but are they living a good life?

For me—actually, a personal story—I suffered from Crohn's disease. I was diagnosed with Crohn's disease when I was about 13 years old and was living with it for many, many years. As I was studying, and then in a high-stress environment, studying for my CFA—the hardest exam on Wall Street—going into finance, moving around the different banks, it was a different lifestyle than I'm living today.

But I really got onto multiple different drugs. I went through the typical health programs that you'd go through to try and put it into remission, and nothing really was working. I hopped around to different drugs and whatnot. What I realized at the end of the day—what really allowed me to put my Crohn's into remission, and today it's in remission—was a complete change in my lifestyle and a complete change in my diet. And I did both. I quit my job in finance, I started to focus on different activities, being out more in nature, and doing more things personally from a lifestyle perspective. But also diet.

Some of the things that I incorporated into my diet were marshmallow root, slippery elm bark, maybe it was probiotics, maybe it was digestive enzymes.

Kyle Feigenbaum: So all these things were playing a real role in keeping myself healthy, and I felt the difference. So the actual question when we started to look into whether these same superfoods could benefit our dog's health was: can these superfoods for gut health and digestive health benefit our dogs? That’s what we did. Actually, one of the first studies we did, even before launching our first product, was with McGill University. We sponsored their Food Science and Nutrition Development program, and the whole goal was to determine: can prebiotics, postbiotics, digestive enzymes also benefit our dogs' health?

And they can. The answer was—they can. And it was like an off-the-charts yes. That actually led to the development of our very first product, which was the Turkey Gut Booster, which is a treat for dogs. We call it a treat with benefits.

Mike Pinkus: Wow. That is—that's an incredible story. I did not know that about you with Crohn's. One of my closest friends growing up had Crohn's as well, and I remember those wild swings with just weight loss and all sorts of things.

Kyle Feigenbaum: Skin issues too. It sucks. These are all autoimmune diseases, and they’re all connected. One thing that I learned is that diet is a massive factor. I think opening my eyes to that from a very personal experience led me to believe that I bet you the same results can be seen in our dogs. And we’re seeing that today. We're getting all these messages from our community, from our customers, and that’s really something—it’s amazing to see how we’re impacting dogs' lives and, as a result, the lives of our human customers.

Mike Pinkus: Yeah, it's really incredible. And Kyle, you starting this business—it's interesting. It's not that big a leap to go from being in finance to being an entrepreneur. I'd put them in the same category, but I think it gives you a bit of a unique advantage in the sense that e-commerce—just to jump right into Healthybud—e-commerce is a tricky, tricky business. You've got product costs. What people don't see behind the scenes, which I want to ask you about, is there's a lot that goes into packaging, logistics, production.

What have you found—first of all, has your CFA added insight and value to you being able to figure out the unit economics of this business? And maybe walk us through a little bit about what it takes to get a product up and running and ready for sale, because that's what people don't get to see.

Kyle Feigenbaum: Yeah. I think one of the best parts of being an entrepreneur is that you end up in this problem-solving playground. And it's exciting because you go through so much. Coming into this business, I knew nothing, really. I knew nothing about starting a business. My first business, like I said, was in university, and it was just off a limb, you know? And we didn't really know what we were doing—but figuring it out along the way. And that's kind of how Healthybud was too.

I definitely brought a lot more experience to building a company. People say I have good financial hygiene. I'd say that comes from doing the CFA and coming from finance. I think cash flow is one of the biggest hurdles that you face as an entrepreneur. That's what puts a lot of businesses under early—not being able to manage money in versus money out. So that certainly helps.

But you brought up Shopify. Shopify was a whole new playground for me and something I knew nothing about. People would use the word "CAC" and I'd be like, what's CAC? Customer acquisition cost? What's customer acquisition cost? I had no idea. So I'm learning. I've learned a lot, and I'm learning a lot as I go.

What's really cool about e-comm is that the environment changes very, very quickly. The tools that are available to us now as entrepreneurs—ChatGPT just being one of many—it's unbelievable how quickly we can learn and pick up new tools today. It's drastically different than where I started. When we started this business four years ago, we just didn't have the tools that we have today.

So, did the CFA help? My mom would like to say yes. My mom was the one that was like, "What are you doing? You're leaving finance after a year and a half of just completing your CFA? How could you do that?" I love her—she was just being cautious, but always wanted to encourage me.

But yeah, it helps, certainly. I just think in entrepreneurship, you're always learning. The biggest learning for me, outside of operations and marketing and dealing with people—which is always challenging and rewarding at the same time—the biggest learning for me is e-comm. I'm still learning every single day how to improve everything from our offers, to our angles, to our audiences, how we're speaking to our customers, engaging the right customers online, customer service. The list goes on and on.

And again, the tools that we're starting to use today are extremely powerful. Knowing how to use the tools that are available to you as an e-comm entrepreneur will put you in a much better position.

Mike Pinkus: I wanted to dive into that a little bit. A lot of people are obviously familiar with Shopify—and that's amazing. Rewind many, many years, there was no way of creating such an amazing user experience where someone could just go buy a product, having that Shopify backend. But you could have the best product in the world, and people still need to know about it.

So, how have you been—what are some of the tools that you have been using? And Kyle, you come from a finance background—how have you been dealing with the marketing side? You now have this amazing product, you're doing something very differentiated because you're focused on the actual wellness and health of dogs. How are you getting the word out there? And have you learned a lot of marketing with whatever these tools are that you're using?

Kyle Feigenbaum: Yeah. So my co-founder is actually my wife. She comes from a background in architecture and music and singing—which is also very not related to pet. And we’re both figuring it out.

She always had an amazing ability to connect. If she was singing, she'd have an amazing ability to connect with the audience. In a social setting, she'd have a great ability to connect with whoever it is that she's talking to. So she's really brought an angle that is: understand your customer to the nth degree and listen to everything they’re asking for and wanting—and using that to develop not only product, but also ads and how you speak to them, how they want to be spoken to.

She's really the one that, again, has her ear to the ground and is able to help us craft different offers and angles, and using different—whether it's creators—putting out our different creatives.

Kyle Feigenbaum: And, you know, if you're speaking to one of our audiences—which is actually very detailed—we found that one of our very key audiences is empty nester parents with a dog.

When you think about it, it actually makes a lot of sense. They might be in a home that's slightly too large, their kids have already moved out, they're parents—mom, dad—they want to care for something. And once their kids are out of the home, they have the dog. The dog becomes their everything. They’re also typically later on in life, and they might still have a double income or a single income, but regardless, their expenses with their kids being out of the house have drastically gone down.

Now they have more disposable income to spend on their dog. So that’s actually a very detailed but key audience of ours. How we target them is still a work in progress, but the way that you speak to that particular individual—and the creative that we might be working with or partnering with to speak to them—is very different than the other creator that is speaking to the 24- to 35-year-old female, which is another key target market of ours.

What that creator looks like, what that creator’s saying, and the type of words even that they're using—it’s very, very different. So finding the right creative, finding the right angle to speak to your right audience is extremely key. And you’re only able to do that if you really understand your audience and who your customers are.

And for us, by the way, we never knew that our customer was that empty nester—oftentimes even widower. These are very detailed things that we only learned much later on in Healthybud’s development. We always thought it was the 24- to 35-year-old female, but we were not necessarily right. So we shifted how we’re going after our audience.

And then from that, once you understand your real customers, then you're able to go and figure out which platforms to use to target them. Is it Pinterest? Is it Facebook and Meta with Instagram? Or is it Google Ads? Which platforms are you using to ensure that you're meeting your customer where they are?

Mike Pinkus: Yeah, that's great advice. Because I think defining that ICP—that ideal customer profile—is something that we all make assumptions on, like you said. And we could be—not dead wrong—but we could be off from what is actually happening, right?

Kyle Feigenbaum: Yeah. One of the best lessons that I learned actually was from a great entrepreneur who had multiple businesses. The one in the pet industry unfortunately didn’t work, and he ended up selling it off—he didn’t really take it to the level that he could have or wanted to. I asked him, “What’s your biggest piece of advice you can give me after going through this?” And he said: “Know your customer extremely well.”

And the best way to do that is by surveying them and serving them—now. Ask them particular questions and understand: why are they—especially the loyal customers—why are they coming back? And for the customers that churn, why are they churning? Are they finding something else that’s comparable?

I think for us, the customers that kept coming back, they started using these words like, “My dog was an extremely picky eater and Healthybud was the only food that they ate.” That’s that aha moment, where you recognize that customers are buying our products for reasons that we might not even be telling other new customers why they should be buying our product.

So from the “picky eater” comments, we developed this Picky Eater Guarantee, where you can buy any Healthybud product, and if your dog does not like it within 30 days, you get a full credit and can try something new.

Mike Pinkus: Wow. Yeah. How has that worked out financially? Like, what are the numbers like? Were you nervous doing that, by the way?

Kyle Feigenbaum: We thought about it. We were really just curious to test it and see how it would work. What made us more comfortable is that we actually knew that our products are really amazing for picky eaters.

A lot of dogs are eating very highly processed diets. And when you give them something that has real nutrition, dogs can smell it. Dogs are pack animals—and that’s why, when a wolf makes a kill, the alpha male always gets the first choice of what part of the animal they want to eat. And it always goes for the organ meat, because the organ meat is very high in nutrition.

Dogs know what is high in nutrition. So that helps with palatability. And with our food—because it’s highly nutritious—it’s actually quite palatable. So I was not too worried, based on how customers were already saying, “Your food is the only food my dog will eat.”

So we tested it. And surprisingly, we definitely do get some customers who say, “My dog didn’t like it. Can they try something else?”

Mike Pinkus: Mm-hmm. Right. There’s inevitably a few.

Kyle Feigenbaum: It’s not that many. And ultimately, I think that’s an opportunity for our customer service to get in touch with that customer. Just those conversations—and the fact that what we’re selling and what we’re saying, it’s real, it’s not just marketing gimmicks—you know, once they have that customer service right from the onset, and then they do try something that their dog loves, and it was a picky eater dog, then they’re hooked.

Because they finally found something. And it’s a challenge as a pet parent—having your dog graze their food bowl or not want to eat. That really sucks. And you get concerned. So it’s really worked in our favor.

It’s very, very rare that there are no products we sell that some dog will like. So we always end up finding—for the most part—we always end up finding something. There are always those one-offs.

Chihuahuas are actually very tough. We find those dogs—like chihuahuas—to be the toughest. And some of our customers will come to us and say, “I have a chihuahua with no teeth.” And we’re like, “Let’s try it.” But it’s difficult. So it depends. But for the most part, there’s always something that a pet parent finds at Healthybud that their dog absolutely devours.

Mike Pinkus: I think—first of all—that advice you got from, I guess, your mentor, it's actually interesting. I want to ask you the question:

Kyle, you said that you've now gone deep into really, really understanding who this customer is. You've also even given guarantees on picky eaters. Do you feel like a business will grow quicker by having that word-of-mouth effect—of having people that are in love with your brand, the products, they’re Healthybud loyalists and they’re going to go tell 20 of their friends that are pet owners—versus, like, obviously there are so many tools now to get marketing out there from an e-commerce perspective, AdWords and PPC and all of that?

What do you think is the balance in order to grow?

Kyle Feigenbaum: It’s such a good question. I think that the e-comm space is so highly competitive today. And all of these companies—and the pet space, by the way, is an oligopoly. A lot of people don’t know that. But the whole space is basically owned by Mars and Nestlé.

The chocolate bar companies and the candy companies—they own all the pet companies: IAMS, Purina, whatnot. So that’s a huge portion of the market.

And the reality is—there are so many unbelievable brands out there. Open Farm, just to name one. I love that brand. I love the founders. They’re just great people, and they make great products. I don’t really see—as much as Open Farm can be considered a competitor—I don’t really see them as a competitor, because at the end of the day, we’re not really trying to steal market share from Open Farm.

Kyle Feigenbaum: We’re trying to steal market share from the longstanding brands that own 80% of the market—80% of the shelf space. So there’s so much room for the newer brands that are actually marketing a very similar agenda, which is healthier food for your dogs and alternatives to kibble, for the most part.

But I think it’s so competitive online that you really have to have a very tailored message, and you really have to be crunching your numbers. The reason I bring up the fact that the pet space is an oligopoly is because a lot of these longer-standing brands—of course, they know their metrics, and we do too. We know what our customer lifetime value is, we know what our first-time average order value is, we know what our margins are.

And that allows you to predict how much you're able to spend—how much you're putting out to acquire a first-time customer—based on how much you get in return. For us, our payback period could be 60 days, it could be 90 days, depending on what offer we’re putting out.

But these larger brands have the cash flow and the money behind them to not depend on a 30-day or 90-day payback. They can be looking much further down the cycle—the customer journey. They also have a much higher average order value because they’re selling so many more products. We have 21 products, which I think is a lot—handling that, in terms of inventory, is its own challenge. But they have thousands. There are so many things they can upsell the consumer on, have them add to the cart.

There’s so much that pet parents can find at these companies, which means they are bidding more for a first-time customer acquisition. And for us, it’s very hard to compete. That’s where word of mouth really comes into play.

I think there are all types of interesting marketing initiatives you can take to grow your business in a more organic way. Organic socials is one of them. We really try as a whole team to put ourselves out on socials, talk to our community.

And customer service—customer service in this day and age is huge. I think the Chewy model was extremely interesting. If your dog passes the rainbow bridge, like we like to say, they’ll send you a card, maybe a picture of your dog, or maybe flowers to your door. And it’s those small gestures that really allow you to show your customers that you care about them—they’re not just a number.

That kind of customer service really creates loyal community and advocates for your brand, which goes extremely far. We see the results of it all the time. It’s very exponential.

Mike Pinkus: Yeah, and I think you’ve brought up some really interesting points. I think every industry, by the way, Kyle, feels your pain. Like, we’re in a space where the big four—the PwCs, Deloittes of the world—I think they do something like $80 billion in worldwide revenue a year. It’s such a staggering scope and scale.

And I think the advantage you have in this space is that you’re nimble. You can be creative and do a bunch of things that don’t scale well—meaning, the big players can’t do that much product research or talk to their customers or have the availability to get that deep in understanding these things.

I wanted to ask you—of the things you’ve listed, we’ve talked about marketing, cash flow, research and development, production—all these things. What would you say are the number one or two biggest challenges you’ve faced scaling Healthybud?

Kyle Feigenbaum: Where do I start? I mean, we’ve faced so many challenges. There’s that saying: “What doesn’t kill you makes you stronger.” Without stress, you're not going to grow—and I think all of that is very true. With the amount of stress we've had, I hope we've grown quite a bit. I think we have.

But we’ve faced external challenges like rising exchange rates, a worldwide pandemic, trade wars more recently—so many things that pop up. And then internally, we’ve had our own set of challenges. I had a co-founder in the early days where that partnership broke up, and that got really ugly. It was really painful for me. That’s just one of the things we’ve faced.

And then internally, we’ve had cash flow issues as well. Cash flow is always hard to manage. There was a point in our business—about three years in—where we were so tight. And this was after a raise. We raised $1.5 million in equity financing, and we raised about half a million dollars in debt financing.

At that point, we were burning money way faster than we ever had—and ever have since. The whole idea was: grow the top line. And that meant bringing on more employees in larger roles with higher salaries, it meant spending more money on marketing. We got to this point where we were really stuck. We were so tight that month we were unable to make payroll.

I actually took a personal loan that month and paid payroll myself. From then on, we recognized that your back can be against the wall in a number of ways as entrepreneurs—but that’s a really bad position to be in.

I remember so clearly having a conversation with Dana, my co-founder and wife, and we were deciding: is now the time to throw in the towel, or do we double down and bet on ourselves and continue to push forward? We decided on the latter.

Now my thing is: I'm going to get to the top of the hill, or I'm going to die trying. We’re pushing Healthybud as much as possible.

But I think the biggest challenges that we’ve faced—there’s a lot—but cash flow is scary. Putting yourself in a situation where you're in a crunch, your back's against the wall, you have payroll, you have expenses, your AR might not exceed your AP as much as you’d like, and things aren’t looking brighter in the future—that was very scary for us.

That was the moment where we recognized we were burning way too fast, trying to grow too fast, and we needed to be more patient. We needed to focus on the channels that were winning for us, and we needed to cut back.

And we did—we went on a huge cost-cutting initiative. We said, “Within six months, we need to be profitable or break even—or very close to it—or else we’re no longer going to be around.”

Mike Pinkus: I appreciate you sharing that, because that’s a story that literally everyone I speak to has been through. I mean, we’ve gone through our challenges. Everyone goes through something like that. And you’ve probably seen this online from mentors as well: the only two things that can kill a business are one, running out of money, or two, giving up.

And kudos to you guys for not giving up. Because unless you’ve sat in the entrepreneurial shoes of growing and scaling, it’s hard to know what that feels like when you're under that pressure.

So Kyle, I wanted to close by asking you: given that you’ve been through all this—if someone’s starting out a business right now, or they’re in the early stages, maybe they haven’t gone through financing rounds, ups and downs, cash flow issues, competition—all these things you’ve been through, any advice you'd give to someone that’s earlier on in their journey?

Kyle Feigenbaum: I think—look, I mean, one of the best pieces of advice that I got was: know your customer very well. So I think that's very important. Listen to your customers. But some of the things that I’ve learned—choose your partners very, very wisely. Partnerships can get really ugly. You need to be aligned, and you need to share the same motivations, and you need to have the same end goal in mind.

And those discussions need to happen early. If they don’t and they come up later, you’re in for a lot of trouble. That was a very painful moment for me—that’s now behind us, thankfully—but it’s something I would definitely pass along to any entrepreneur I’m speaking with.

And the other thing I would say is: be very, very focused and intentional with everything you take on. As an entrepreneur, especially early on in a business, there are so many opportunities that can arise—and a lot of them seem really exciting to go after—but you’ve got to stick to what makes you unique, and stick to what your core focus is.

I think patience is so extremely important in entrepreneurship, because businesses take a lot longer to grow than most people think. Businesses take a long time, and you go through a lot of trouble at the onset.

If you're getting into business because you think you're going to buy back your time and your freedom and money early on, then you need to second-guess it. I think those things can happen, and that’s one of my goals now—buying back my time and gaining more freedom—but I’m five years in, and we’re just getting started to do some of those things.

So yeah, it takes time. It’s a hell of a long journey. Surround yourself with good people, and be patient, and you’ll have a much better chance of succeeding. That would be my tips.

Mike Pinkus: That’s awesome. Well, I’m not going to ask you any more. We might as well close with that, because that’s amazing advice. Thank you, Kyle, for joining me today. I really appreciate you sharing all of this.

Kyle Feigenbaum: Yeah, thank you, Mike. It’s been a pleasure. Thanks for having me.

Mike Pinkus: Yeah, thanks so much.