Dan Wise is on a kind of mission.
“We are encouraging our customers to rise up against fake food,” says Wise, founder and CEO of RealEats America Inc.
Wise’s zeal powered the creation of a Geneva startup that cooks healthy, nutritious meals and ships them to more than 20 states. In November, RealEats took home $1 million at the inaugural Grow-NY Food and Agriculture Business Competition, an effort modeled after the successful Luminate NY Accelerator Competition.
RealEats is an illustration of the activity in the region’s agricultural and food industry, alongside businesses such as LiDestri Food and Drink, Perfect Granola and Farther Farms, a developer of platform technologies to expand opportunities throughout the food system.
The proliferation and growth of companies like RealEats is expected to benefit the Finger Lakes region’s agricultural economy and boost employment in the state’s food production industry, building on the Finger Lakes Economic Development Council’s plan to foster a vibrant ag and food-processing sector.
In the FLREDC’s 2019 report, the council points to the region’s efforts to attract and retain a workforce through its agriculture and food pillar. “The Finger Lakes region is an interconnected food ecosystem with agricultural assets that spread across nine counties and positions the region to be a global leader in agriculture and food production,” the report states.
Based in Geneva, RealEats cooks its dinners and breakfasts in its kitchen, vacuum-seals them in pouches, refrigerates them, and sends them to subscribers weekly, ready to be reheated with ease. Made from fresh ingredients that are generally locally sourced, and free of preservatives and other potentially harmful materials, these meals require very little preparation. All a hungry subscriber needs to do is drop a plastic pouch into boiling water for six minutes, empty its contents onto a plate and sit down, utensils in hand. For those constantly on the go, it can be an attractive meal option.
“People don’t have time to cook meals,” says Theresa Mazzullo, CEO of Excell Partners, which has invested in RealEats “They’re solving a very important problem in the marketplace, lack of time.”
Last January, RealEats announced plans for a $2 million expansion in Geneva, which included adding up to 400 jobs over the next five years. Officials said the company chose Geneva for its expansion because of its central location in the Finger Lakes agricultural region and its proximity to the Technology Farm and the Center of Excellence in Food and Agriculture at Cornell.
“The bounty of this region in both agriculture and talent is a perfect match for RealEats,” Wise said at the time.
Cooking at home
Wise came up with the idea of starting RealEats while trying to cook for his two young boys at his home in Montreal, Canada. As the founder and CEO of CroJack Capital, which helps manufacturers profitably deal with excess inventory, he already led a busy life.
“I was struggling to find a healthy meal solution for us,” Wise says. “Every time I tried to cook for my boys, they would kind of look at me as if I had three heads, wondering why I was in the kitchen, trying to make them my victims.”
He took his kids to restaurants and tried meal-delivery services, but neither offered the kinds of healthy foods desired. Then, a friend who is a chef and caterer told Wise how he took care of his customers.
“He would prepare the food, he would vacuum-seal it, and then send it out on jobs,” Wise recalls.
If refrigerated, the contents of the plastic pouches stayed fresh for about a week. The caterer’s staff needed only to drop the pouches in boiling water for a short time and serve the meals they contained. Wise saw the possibilities that the approach offered.
“Not only did this solve my dinner dilemma, but it could also solve the dinner dilemma for a lot of people,” he says. “I thought there was a great opportunity there to make an impact on people’s health and wellness, not the least of which was my own family’s.”
The approach also presented business opportunities. In recent years, Americans who don’t have the time to shop for ingredients or the desire to spend time over hot stoves have flocked to companies that do one or both of those tasks for their customers. Firms like RealEats that provide meals requiring little effort to prepare for the table have generated more than $65.5 million in the United States this year, and the market is expected to grow by 2.6 percent annually, reports show.
A healthy start
Using just his bank account for funding, Wise set out to see whether it might be possible to tap into that market by offering healthy, vacuum-packed meals for sale. A pilot program that sold such fare online and in some of Montreal’s gyms from early 2015 to mid-2016 brought good news.
“The product started gaining traction in Montreal, which is a relatively small market,” Wise explains. “I thought it would be a good idea to offer the product to a bigger market.”
That led to the founding of RealEats in 2017. The firm now operates in slightly less than 10,000 square feet of the Geneva Enterprise and Development Center, a combination of office space and production incubator. The location of the facility was a big plus in Wise’s eyes.
“The abundance of agriculture in the Finger Lakes allows us the opportunity to source nutrient-dense ingredients in our own backyard,” he says. “For us, it was incredibly important to know where the food comes from, work with farmers that responsibly grow and produce the foods that we use.”
At the same time, RealEats gained ready access to the assistance of Cornell AgriTech, Cornell University’s agriculture and food research arm.
“Cornell AgriTech was instrumental in helping RealEats develop our food safety scheduled processes,” Wise notes. “Developing this piece was significant in acquiring the certifications required to run our business.”
RealEats markets to potential customers through digital advertising and social media, and hired a national public relations agency to get its message out. Though Wise did not disclose the firm’s sales, he says figures indicate that those approaches are working.
“We had significant growth in 2018,” Wise says. “This year we’re going to double that business.”
The firm’s roster has also grown. RealEats had about 10 employees when it opened its doors, and now has about 50 people on its payroll.
This year, RealEats made headlines when it beat a large number of other firms to take the grand prize in the first annual Grow-NY competition. The contest was held by Grow-NY, a joint program of Empire State Development and Cornell University’s Center for Regional Economic Advancement.
“Grow-NY is a program that was developed to foster innovation and entrepreneurialism in the food and agriculture space in the Finger Lakes, Central New York and the Southern Tier,” says Jenn Smith, Grow-NY program director.
CREA administered the Grow-NY competition, which kicked off in May. Startups from around the world were allowed to enter the contest—one was from Munich, Germany. A total of 199 established but relatively new businesses were selected and vied for the top prizes.
A panel of 30 judges—leaders in the food and agriculture sectors—watched contestants’ progress. Each firm was evaluated according to five criteria, including the commercial viability of its business model and the firm’s potential for creating jobs in Grow-NY’s regions. An ability to bring results quickly was also a big plus.
“A company that’s looking at a three- to five-year trajectory isn’t necessarily going to be a strong contender,” Smith says. “We’re really looking to see an impact in the region in the first 12 months.”
As the competition proceeded, firms were paired with mentors, individuals from the business community who know how to develop and run competitive businesses. The mentors helped their candidates prepare for the most important part of the contest: pitching the value of their firms to contest judges.
“You’re trying to explain to people in a very short time—a 10-minute pitch—exactly how you’re prepared for success,” says Eric Mozdy, the business technology director for the Corning Research and Development Corp.’s Emerging Innovations Group. He was RealEats’ mentor for eight weeks.
Mozdy began by looking over RealEats with the firm’s management team.
“Where does the company feel they are with respect to being able to pitch?” he says. “What elements might they need some assistance and guidance with?”
While helping RealEats deal with those issues, Mozdy also suggested how the firm might move forward in the future.
“We discussed some of the technologies or tools that they wanted to have at their disposal,” he explains. “We had some discussions around where I could connect them with certain people, resources or things that might pertain to what they’re looking at.”
A panel winnowed the contestants down, over time, until 17 finalists were left. In November, representatives of those firms came to the Joseph A. Floreano Rochester Riverside Convention Center in Rochester for the two-day Grow-NY Food and Ag Summit. There, they made their pitches to the judges, and more than 900 attendees.
Grow-NY awarded a total of $3 million in prizes to seven companies. By accepting the awards, winners agreed to operate in Central New York, the Finger Lakes or the Southern Tier for at least one year.
Catherine Young, executive director of Cornell Agritech’s Center of Excellence for Food and Agriculture, says companies like RealEats are important to upstate’s economy.
“They are a local economic driver that is providing jobs and opportunities to families,” she says. “They are also sourcing ingredients from local farms, which helps our agricultural economy.”
That economic driver could easily grow stronger, fed by the by upstate’s agricultural sector.
“You have all the ingredients for companies like (RealEats) to come here and grow here,” says Vincent Esposito, Finger Lakes Regional Director for Empire State Development.
If such firms proliferate and grow, they could deeply affect upstate’s economy long term. A 2014 study from the Dyson School of Applied Economics and Management at Cornell’s College of Agriculture and Life Sciences found that the state’s agricultural economy contributed $44.8 billion to New York’s overall economy. It reflects both production expenditures and business-to-business transactions from neighboring industries involved in the agricultural economy.
“We’ve had an economy upstate that’s been transitioning from the heavy manufacturing we saw in the previous century,” Esposito says. “They’re an example of how innovations and changing markets have redefined the way upstate’s economy works, and the potential in it.”
Mazzullo applauds the Grow-NY judges’ decision but adds that RealEats has challenges ahead of it.
“Usually, one of the biggest challenges a lot of startup companies have is scaling,” she says. “You’re doing great when you’ve got small to medium-sized orders, but when that becomes a national company, a lot of things can go bump in the night.”
The ready-to-eat meals market includes players like Freshly, which prepares gluten- and peanut-free meals that only need to be reheated, and Veestro, which offers vegan plant-based organic breakfasts, lunches and dinners. Others like Daily Harvest and Factor also target consumers who want to eat healthy with ease. According to ResearchAndMarkets.com, frozen ready meals dominate the global market with a share of more than 52 percent.
Wise gives some of the credit for RealEats’ success so far to the community, city and state in which it’s located.
“The support from progressive state and local governments has helped our company succeed,” he says. “In my opinion, there’s no better location to build a better food future.”
RealEats has raised roughly $6 million from government agencies and private investors since it was founded.
“By 2022, we hope to grow the business about 20 times from where we are today,” Wise says.
Mike Costanza is a Rochester Beacon contributing writer.
Unfortunately this story simply illustrates a fundamental issue all of these home delivery companies do extremely poorly: packaging. I have tried several and while the food was ok, there was a monstrous pile of unrecyclable plastic and cardboard with each, in part because of shipping considerations (in my building these packages sometimes sit in the hall for several days). Vacuum packed in plastic bags, which are not recyclable and presumably packaged in some kind of insulation for shipping? We simply cannot sustain any of that. Assuming they are single servings, they are just another plastic problem without a viable alternative. I would like to hear how they plan to solve this, if they plan to solve it.