Clodhoppers founders recount transformation

Chris Emery and Larry Finnson aren’t the only high school buddies who have pursued a questionable business idea.

Chris Emery and Larry Finnson

Chris Emery and Larry Finnson aren’t the only high school buddies who have pursued a questionable business idea.

But they’re among the most successful.

The founders of Clodhoppers candy recounted their transformation from kitchen manufacturers to confection magnates during a presentation in Red Deer on Tuesday.

Speaking at a Farm Credit Canada forum in the Capri Centre, the Winnipeg men described how they used a tasty recipe of Emery’s grandmother to build one of the top food companies in Canada.

After each contributing $6,000 in start-up capital, the pair began making Clodhoppers as Krave’s Candy Co. Initially, they made the graham wafer fudge clusters in Emery’s home and packaged it in clear plastic jars — which appeared half empty when their contents settled.

“We basically went around Winnipeg resetting every jar,” said Finnson, recalling how shaking the containers left something that looked like a “brain in a jar.”

The partners bought some used equipment and changed their packaging.

“That resulted in Wal-Mart deciding to carry our product,” said Emery, referring to this 1998 development as Krave’s first big break.

Wal-Mart remained a buyer in 1999 and other retailers came on board. Emery and Finnson had to increase the size of their operations, but capital proved elusive.

Ultimately, they managed to borrow $100,000 at an interest rate of 30 per cent, pledging their homes as equity.

A profile on CBC business program Venture helped raise their business’s profile, and eventually a Manitoba venture capital fund and then traditional lenders provided financing.

In 2001, the creators of Clodhoppers found themselves chatting with a stranger at a Wal-Mart vendors show. He turned out to be then Wal-Mart president and CEO Lee Scott.

Scott suggested that they send some Clodhoppers to Wal-Mart’s global head office in Bentonville Ark. Soon, it was available in 2,700 Wal-Mart stores.

While visiting Bentonville, Emery and Finnson conducted a product demo. There, a man commented that they reminded him of famed ice cream entrepreneurs Ben Cohen and Jerry Greenfield — a.k.a. Ben & Jerry.

“That was kind of the impetus for us to change our packaging,” said Emery, explaining that adding their caricatures helped capitalize on the well-publicized story about how two young men had built the business around a family recipe.

They also described how, during a Dairy Queen forum in Nashville, Tenn., they discovered that the fast-food company’s president and CEO was auctioning his services as a charitable fundraiser. Seeing a promotional opportunity, they joined the bidding — only to realize at the end that Emery had inadvertently topped Finnson’s final offer.

“That’s how I became president,” laughed Finnson.

Another marketing strategy involved partnerships with WestJet and Air Canada, who agreed to serve Clodhoppers to passengers as alternative to traditional snacks.

“We were paid for that, and it greatly exposed our brand to a lot of people,” said Emery.

“We had no money, so we had to be creative,” added Finnson.

In addition to Venture, they got air time on television talk show Open Mike with Mike Bullard and even on CNN.

They also grew Clodhoppers from a Christmas treat to a year-round snack.

“We were up to about 35 employees and we were producing over two million pounds of Clodhoppers annually,” said Emery.

By 2004, Emery and Finnson realized they had to undertake some costly marketing initiatives to take Krave’s to the next level.

“We were at $10 million in sales, and we wanted to go to $20 million,” explained Finnson.

The company’s board of directors, which had evolved from its venture capitalists and other financial backers, were not prepared to make that investment. So the decision was made to sell the business, and a deal with Brookside Foods Ltd. closed in 2006.

The partners have no regrets, pointing to many business lessons learned and contacts made.

Now 41 and 40 respectively, Emery and Finnson are preparing for their next venture, although they’re not ready to disclose details.

“We’ve got a plan,” said Emery.

hrichards@bprda.wpengine.com

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