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TERO ISOKAUPPILA:
When I say to someone
that I'm interested in mushrooms
or that I have a mushroom
company, you get often a
few kinds of reactions.
Some are like, are you
talking magic mushrooms?
And some are like,
gross, I don't
like the flavor of mushrooms.
And some are really excited
for various reasons.
But they are a kingdom,
as you saw in the video.
And when something
is a kingdom, that
means that there's a lot of
different kinds of things.
So if you think of all the
animals that live on Earth,
there's quite a few kinds.
Just take mammals.
Compare a Chihuahua
and a blue whale,
and they're drastically
different, right?
And if you compare even
plants, not all plants
are good for you.
I know, obviously, a plant-based
diet is right now a big thing.
A lot of people on it.
But a lot of plants
will kill you.
And mushrooms are no different.
Some of them will hurt you.
Some of them will heal you.
And just to kind of get the
mushroom lingo out of the way,
mushroom is actually what
is called a fruiting body.
And fungi is a kingdom.
Fungi is like an umbrella.
But often people, when they
talk about the fungi kingdom,
they talk about mushrooms.
But mushroom is actually
like the fruiting body.
So let's think of an
apple tree, for example.
The fruit, the actual apple,
would be the fruiting body
here.
That's the part that is
visible, and you will eat.
And it usually gets reproduced
annually with some exceptions.
And then the rooting
system, which is often
referred to as mycelium--
it was also like hyphae,
like an early version of it--
but mycelium is like
the actual apple tree
itself, the bark and the roots.
And there is a lot of
mycelium underground.
So wherever you will
go around the world,
there will be
mycelium underground.
And then sometimes, you'll
see these fruiting bodies
popping up.
And the mycelium is really
important for the environment.
And the fruiting body can
be really helpful for us.
So since there is
mycelium everywhere,
it serves a big purpose.
So about 2.4 billion years ago--
so if the Earth is 4.2,
4.5 billion years old,
2.4 billion years ago mushrooms
or fungi came from the seed
to the dry land.
And what's actually fascinating
about mushrooms to me
is that they're actually
very similar to animals.
So we're way closer
as humans to mushrooms
than we are to, for
example, plants.
For example, mushrooms cannot
produce their own food through
photosynthesis like plants can.
They have to eat something.
By the way, they also breathe
oxygen and expel CO2, just
like animals.
But they need to eat something.
And since nothing
else grew on dry land,
mushrooms decided to, for a
little over a billion years,
eat rocks.
So they're survivors, you know?
And then later, as plants
were entered in to the Earth,
the mushrooms helped the plants
to collect water and nutrients
from the soil.
And that happens still today.
So almost all plants
that you'll eat
have used fungi to collect
water and nutrients.
But this is not
a biology lesson.
I'm not here to talk to you for
hours and hours about fungi.
Some of you might
find it fascinating.
Some of you might not.
But I just wanted to give
you kind of a quick overview.
And the spores are-- by the
way, those are the seeds.
So you go from the rooting
system to the fruiting body.
The fruiting body
will produce spores.
Spores are like the seeds.
And then the spores will fly
away and produce more hyphae
and mycelium.
So that's kind of the
lifecycle of a mushroom.
My company Four
Sigmatic is focused
on these functional mushrooms.
Those are like
healthy mushrooms.
Often sometimes known
as medicinal mushrooms.
But since medicinal marijuana,
that's often a bad label.
These are completely
legal, safe,
nothing to do with psychedelics.
So that's why I prefer the
word functional mushrooms.
And these functional
mushrooms are often
also called adaptogens.
How many have heard
the word adaptogen?
A good bunch.
OK.
So this is right
now really trendy.
It's actually not
that new of a concept.
It's just become very popular.
So adaptogen research started in
the Soviet Union for the army.
What the army figured out--
and this is, by the way,
not just the Soviet army.
I had to go to--
I'm originally
from Finland, and I
had to go to the Finnish Army.
And the same thing is
in certain situations,
the soldiers are
given stimulants.
Amphetamine, for example.
I was in the Air Force.
You fly in a fighter jet.
You crash on enemy territory.
Pump you up a
little amphetamine,
and try to run as far as you
can in the next 24 hours,
so hopefully you'll
be safe after that.
But what happens is that you
have a little bit of a letdown.
A lighter version
of a stimulant might
be like Adderall, lighter
compared to amphetamine,
or caffeine that we often
consume all the time, right?
So the Russian-- the
Soviets were like, hey,
is there anything
else that we could
take which would perform
performance, maybe not as much,
but would improve performance
and wouldn't give you
the letdown the next day?
And they send this
doctor, Dr. Lazarov,
to research a few things.
And Lazarov studied
the best things
that he could find in the world,
and came up with five things
that he thought were adaptogens.
And the word adaptogen
comes from the fact
that it helps you to
adapt to stressors.
So it helps you to
adapt to stressors.
And hopefully, it will
not give you a letdown.
So in order for something
to be an adaptogen,
it needs three things.
It's non-habit-forming.
It means it's not addictive.
If something is addictive,
it cannot be an adaptogen.
They have to be something you
could take every day safely,
and you don't get used to it.
Secondly, it restores balance.
So it restores
balance in your body.
And then, finally,
it's nonspecific,
which is often sometimes hard
if you have a scientific mind
to figure out, because
scientific studies are usually
done on one single
variable, one marker.
And when something
is nonspecific,
it can help with the
brain and immune function.
And that can be complicated.
And that's where it's often
in health, like hormones,
for example.
Even though you have a
marker like testosterone,
it's sometimes complicated,
because hormones
go up and down.
You pull a lever.
Another one goes
up or down, right?
But that's what adaptogens are.
And that's what some of these
best mushrooms are as well.
And these are kind of
my passion, I would say.
I love fungi.
And I love the biology of fungi.
But I'm mostly interested in,
what can the fungi do for you?
How can it improve your
cognitive function,
your immune system, your skin?
I've been running my business
now for about seven years.
Normally, I've been traveling
40 to 60 times a year.
And during that time.
I've lived in-- in
the last 10 years,
I've lived in 10 countries.
And I've not been
sick in 11 years.
And one of the reasons
why I have to thank
is the use of
adaptogens and mushrooms
for the immune system.
But back to my story.
So I was brought up in Finland.
I'm a 13 generation farmer
and mushroom enthusiast.
And I was brought up to learn
about mushrooms through my mom.
My mom, when I was like
yay high with my brother,
we went foraging for mushrooms.
And one of the first things
that people get wrong
about mushrooms is that they
always grow on the ground.
They actually also
grow on trees.
This is a chaga
mushroom that we also
use in the mushroom
coffee that is outside.
And a lot of them are hard.
You can't eat them.
Actually, you should
not eat mushrooms raw.
Just a general rule of thumb.
Whatever mushroom we're
talking about, don't have them
raw, because they have this
structure called chitin
that we humans are not
really good at absorbing.
And we lack this enzyme.
Think of the shell of a
lobster is made out of chitin.
So try eating a lobster shell.
Not good.
So you kind of
have to process it.
But they are these
beautiful creatures.
Most people just think
of that classic mushroom
shape, which I showed you
with the stem and the cap.
But there's so many
different shapes and sizes,
different types of mushrooms.
And some of the best
ones grow on trees,
because, like I mentioned,
mushrooms, like animals, they
need something to eat.
And often when people ask me
like, what should you eat?
What's a healthy diet?
I joke to them that you
should eat dirt and trees.
The healthiest thing you
can eat is dirt and trees.
Unfortunately,
we're not equipped
to assimilate either of them.
So we need to eat something
that has eaten them.
So things that grow in the soil,
that have minerals, and then
can get the good gut biome
from the soil into our body.
And also trees are
incredibly healthy.
So obviously from maple
syrup to pine pollen,
but also to these
tree mushrooms that
serve so many
different functions.
This is called turkey tail.
This is called reishi.
And a lot of the mushroom
names are a little exotic.
Cordyceps, which are
used for performance.
This is lion's mane.
This is right now one of
the most popular mushrooms
in the US.
It's touted to help with
focus and cognitive function.
And it's funny how they look
as well as like lion's mane.
It looks like a, I
guess, a mane of a lion.
So that's how it's
named that way.
But my fascination
with these is mostly
through the health benefits.
Like you saw in the
beginning video,
mushrooms are used in almost
half of the pharmaceuticals
out there.
Penicillin is the
one you would know.
But out of the 20 best selling
drugs, about 10 utilize fungi.
And they can be used
to clean oil spills.
They can help remove
diesel from the soil.
They can eat plastic.
A few years ago we found a
mushroom that eats plastic.
Plastic has been
around 100, 120 years.
And so far we haven't
figured out what--
does it compost or not?
We don't know yet.
But we found a mushroom
that likes to eat it.
And then we can
eat the mushroom,
and it has health benefits.
But I think the
environmental change
is it's hard to change the
world through the environmental
impact.
It's hard to change the
world, too, sometimes.
A lot of like very
esoteric topics.
But what often people are
first interested in is,
hey, what can I do today
to feel good today?
And mushrooms can
help with that.
Here's a little chart
that shows a mushroom
chaga, which is this one.
It grows on a birch tree.
It grows from 10 to 25 years.
So very slowly.
And birch has these healthy
compounds, like betulin
and betulinic acid.
That's why if you go
to Finland or Russia
you hit yourself
with birch leaves,
because they have these
healthy oils in the bark.
And kind of the mushroom kind
of eats them, and then gets them
in a form that then
we can utilize.
And the amount of antioxidants
is quite incredible.
So antioxidants are
one of the things
that are most proven for
general health and wellness
in the world.
It's kind of a buzzy word.
People don't really
know what it means.
But they are color pigments.
Not all color pigments
are antioxidants,
but all antioxidants
are color pigments.
It's like the champagne thing
with the sparkling wine.
Not all sparkling
wine is champagne,
but all champagne is
sparkling wine, right?
And these color
pigments can help
with cardiovascular health.
They can help protect
our immune system.
A lot of the most common
ways how people die today.
And they can really
help with longevity.
And people off the
internet love to debate
what antioxidants are good and
what has the highest amount.
But just for the sake,
the two big bubbles
are two different ways I can
process a wild Siberian chaga.
And then you have some of
the other more antioxidant
rich foods from dark
chocolate to acai berry.
And this gives you an idea of
how abundant these mushrooms
are in these nutrients
and how potentially you
could benefit from them.
And that's a chart
on how to use them.
So mushrooms are often used--
for most people, they're
used in like pizza or pasta
or something like a
very narrow focus.
People mostly
focus on portobello
and like cremini type mushrooms.
Maybe shiitake.
And shiitake is a good mushroom.
But a lot of these culinary
mushrooms are not that good.
They grow on the ground.
And they're not
that nutrient dense.
They're kind of
like mass produced.
Think of like your
normal culinary mushrooms
almost like iceberg
lettuce versus arugula.
There's nothing wrong
with iceberg lettuce.
But clearly, nettle or
dandelion or arugula
has a lot more punch.
And the same with mushrooms.
And when we talk generally about
mushrooms, it's like anything.
It's like you have really good,
really average, and then really
bad things.
And that's where actually
my company Four Sigmatic
also stems.
It's just geeky out of math.
So if you take all
the world's foods.
There's roughly like, let's say,
1.8 million things you can eat.
And if you put it
on a bell curve
and compare the
nutrient density,
it'll form a normal
distribution.
And this is normally science,
including natural sciences.
If you take a large
enough sample size,
you look at single variable--
like how tall are people?
Or what is their IQ?
It tends to form a
normal distribution.
The foods are the same.
And if you look at
their nutrient density,
most foods are
just normal, good.
Some are like
solid health foods.
And then some foods
are kind of bad, right?
And if you go four standard
deviations, which are sigmas,
if we go four
standard deviations,
you get to the top 50
foods in the world.
And out of those
top 50 foods, there
are things like lemon, black
pepper, cinnamon, coconut,
green tea, cacao,
things that you know.
Then there's foods that you
might know, like turmeric,
or ginseng, or maca.
And then there's really
foods that very few people
know, like the reishi
mushroom or astragalus root.
And I'm just passionate
about the things
that are the most currently
scientifically studied foods.
And funny enough,
those tend to be also
the foods that have
been used the longest
throughout different cultures.
So every part of the world
tends to have their own foods
that they've elevated to
kind of a sacred status
over multiple generations.
And every generation
after that has
thought that that food is
special for some reason.
So if you go to
Bali or Costa Rica
or you go to Finland and
Russia or you go to Africa,
you'll find certain foods
are elevated over others.
And that's what I'm
most passionate about.
And out of those 50,
about 10 are mushrooms.
That's our farm where I grew up.
And I think besides the health
benefits of mushrooms, the one
thing that I really
want to leave you today
with is just
generally about what
it takes to do something new.
I feel like the topic was like
how to go from dirt to gold.
And I think that's
the lesson that I've
learned over the years of coming
from a small farm in Finland
to Venice Beach, California
and building a business
and creating companies, like
understanding that in order
to create value
or capture value,
you have to see
undervalued things.
So any form of business, be it
investing or something else,
you're trying to find an
asset or a thing that has more
value than other people think.
You think the
stock is worth $10,
but the market thinks it's $5.
You buy it at $5.
You think eventually the
market will know it's
worth $10, right?
The same with if you start a
business or you have an idea,
you try to find something
that others don't yet see,
or they see it, but they don't
understand the true value
and power of it.
So probably, let's say,
Google in the early days,
there were people who thought,
oh, a search engine has value,
right?
It's some value.
But then people
didn't see what's
the implications of
having that value
and how you can transport
it to other factors.
And then investors of Google
probably made good profit
by seeing that it was
an undervalued asset.
So I'm from a town of
maybe like 150 people.
And I'm there-- like I
didn't travel growing up.
And my dream is to get
Americans drinking mushrooms.
That's a pretty
radical idea, right?
So it's like I came here.
I started the business.
And I told everyone.
It was like, hey, I want to
get the whole America drinking
mushrooms, because that's the
most ancient way of actually
consuming these tree mushrooms.
And I know there are benefits.
And people are
like, you're crazy.
Nobody drinks
mushrooms around here.
But I believed in it, which
is one of the three tips
I want to leave you guys today
with from the business side.
If you want to
achieve anything, you
have to be super passionate
about it and believe in it.
And the second thing is that
hopefully whatever you do
is based on some
first principles.
With me, with science,
understanding the research
around mushrooms,
understanding their history,
and their culture implications,
and also understanding
how to prepare them.
So you can't just make up stuff.
It needs to be based on some
sort of like first principle
or a logic.
And then, finally, as you
start building the business,
remembering why you started it.
I was a couple of
weeks ago in Lapland
with a bunch of friends.
It was minus 39 degrees,
and it went to frozen water.
It's actually below.
It's like 25 degrees.
There's a stream that
keeps the water open.
This is the culture--
why I started the business
is the Finnish culture,
and the culture of
like natural living.
And then I moved to California
to build the business,
and sometimes the life
here is not as natural
as it was at a farm.
But it's really important for
me as I go to remind myself
why I started the business.
This is the Sami culture.
This is the only indigenous
culture in Europe, partly
in Finland as well.
And how they use mushrooms
is one of the sources
of inspiration for me.
And here's examples of
products that we do,
like mushroom coffee,
mushroom chocolate, lattes,
wellness tonics.
And one of the
reasons why we do this
is that mushrooms,
the healthy mushrooms,
don't taste anything
like portobello.
They actually taste very bitter.
And most Americans
don't like bitter.
So when I came here and
I made like mushroom tea,
people were like, this is gross.
First of all, I don't like tea.
Secondly, I don't
like this flavor.
So I had to kind of reverse
engineer and figure out,
what are the bitters that
Americans like or most
Anglo-Saxon cultures like?
And I figured out there's only
a couple, coffee and chocolate.
Black coffee and
dark chocolate were
some of the only
bitters that were
commonly available to people.
So using those palettes
and those delivery systems
is incorporating
into people's lives.
But to kind of recap, here are
some of the books I've written.
One about the history
of the Sami people, one
a cookbook how to use mushrooms,
and about the top 10 mushrooms.
But to recap kind of
my talk is I believe
in the power of mushrooms.
I think they're an organism
much smarter than we realize.
I think they're undervalued.
And that's why I'm
also excited to build
a business around them.
I believe a lot in
their power for myself,
but also, I believe,
that you should
focus on doing something
that is undervalued
and getting people to
understand the value,
then that's also smart business.
I think if you want to
learn more about mushrooms,
there's a lot of resources
that you can go to.
I can highlight a few
books and learning methods
how you can learn about them.
And I think in
the next 10 years,
we'll see multiple different
research coming out
for mushrooms for
health benefits,
for cognitive function,
for the immune system,
that I think will
shock a lot of people.
And that gets me
excited every day
to start building Four Sigmatic.
But with that, if you have
any questions about the health
benefits on Four Sigmatic
or the mushrooms in general,
if you have questions on
anything mushroom related,
I'm happy to take it.
AUDIENCE: Is this
the microphone?
TERO ISOKAUPPILA: Yeah.
AUDIENCE: This isn't
about mushrooms.
But snails eat mushrooms.
Does that mean snails
are healthy, too?
TERO ISOKAUPPILA: Yes and no.
Not because they eat mushrooms.
That's not the reason.
So there are sort of
mammals that eat mushrooms;
bears, deer, rabbits.
There's certain insects
that eat mushrooms.
That doesn't mean
that that's why
that species is good for you.
But I would say,
generally, we're
very focused as a culture on
large mammals that have flesh.
This is a complete
separate topic from health.
We're really obsessed about just
eating a few types of animals.
So the classic debate
is, should I eat animals
or should I not eat animals?
But often, it's
coming from the lens
of eating mostly large mammals
that are very domesticated that
are almost always female.
We almost only eat women.
So we don't eat bull.
We eat the cow.
We don't eat like a boar.
We eat the female.
Chicken, the same.
We don't eat the rooster.
We eat very highly
processed animals.
And we don't even eat the
whole piece of that animal.
We mostly focus
on the flesh part
versus like the liver and the
eyeballs and all the things
that most people think is gross.
It's actually like
really nutrient dense.
And a lot of insects
and smaller animals
tend to be healthier,
actually, because they're
lower in the food chain.
So you tend to be like the
lower you are in the food chain,
and early you are,
the cleaner it is.
Or if you go further
in the food chain
and you go to bigger
animals or even bigger fish,
you have to be more
careful about the quality.
So it's usually safer to eat
a small fish than a big fish,
but you really
have to know where
the big fish is coming from.
But it's not because
they eat mushrooms.
That's why snails are healthy.
They just are.
Can you pass the mic?
AUDIENCE: Can I throw it?
TERO ISOKAUPPILA:
You can throw it.
AUDIENCE: Hi.
Thanks for the talk.
TERO ISOKAUPPILA: Yeah.
AUDIENCE: You raised the
point about bitterness.
I was just wondering, have you
found yourself compromising
the healthiness of the
mushrooms by like adding sugar
at any point?
TERO ISOKAUPPILA: Yeah, most of
our products don't have sugar.
And I don't really
believe in adding sugar,
especially processed sugar.
We have a couple products
that have coconut palm sugar,
about 2 grams per serving.
AUDIENCE: Awesome.
TERO ISOKAUPPILA: And coconut
palm sugar is a lot healthier.
It has more minerals.
And is more kind of
diabetic friendly.
But I don't believe
in adding sugar.
We use things like monk fruit
and stevia in certain products
and certain products
are unsweetened.
It's kind of this
healthy balance
of knowing where the
market is, and knowing
where you want to get to, and
kind of like bridging the gap.
So let's assume you
want really technology.
I'm from Finland.
We love like MySQL and
Linux, and all this stuff.
Linux never really got
big, except in servers,
just partly because the
user interface was not
the easiest to use.
Or even Nokia, where our
farm is, is I think of Nokia
leading that mobile technology.
And then Apple taking over.
And it's partly
because Apple is just--
the iPhone is just so much
easier to use for most people,
right?
And Nokia's were always not.
And the same here.
My dream is to get here,
but consumers are here.
How do I meet them
in the middle?
How do I make a product that is
a little more bitter than what
they're used to, a little
less sweet, a little less
artificial, still healthy.
But I kind of meet them.
Because without compliance,
there's no change.
There's no-- like you can
buy a pass to the gym,
but if you never go,
it doesn't help you.
So I'd rather do a shitty
workout than no workout.
So in this case, the same thing.
But yeah, I wouldn't add
much sugar or any sugar
to these products,
because I think
it jeopardizes the
main function, which
is kind of being more
like anti-inflammatory
and protecting
the immune system.
And when you add these
sugars and sweeteners,
you can kind of do the opposite.
Mushrooms can also
balance blood sugar
and support blood
sugar management.
So when you kind of do that,
it kind of counterbalances
the benefit.
AUDIENCE: Yeah, that was great.
Thanks.
TERO ISOKAUPPILA: Yeah.
AUDIENCE: So I've heard
formulating new products
and bringing them to market
is like a multi-year process.
And it takes a lot of
R&D and energy resources.
TERO ISOKAUPPILA: Sure.
AUDIENCE: I'm
curious if you have
a lot of different products.
I keep seeing new stuff you
produce quite regularly.
How long is your design process?
TERO ISOKAUPPILA: By the way,
thank you for asking that.
You're the first
person to ever ask it.
I'm very passionate
about this topic.
So I'm like the product founder.
So if we would be
a tech company,
I would be like loving
to make the code myself.
And I'm like this
is really a topic
that I could talk for days.
So you're right.
Most people take multiple
years to build a product.
For us, my goal is two months.
Realistically, we're at three.
But it's still drastically
shorter than for most people.
And that requires a
few fundamental things
to be in place to
innovate so quickly.
So obviously, like sourcing
ingredients, any ingredients
that you're going to use, you
have to be really good at that.
So you have to have a baseline
infrastructure of like, hey,
where do you get products?
But that's still like
somewhat easy to solve,
where most even
large companies take
years to develop a product.
And they don't succeed with it.
And I think one of
the key things why
we've been successful in a
short while building products is
a couple of fundamental
things that I think
is transferable to any industry,
any product, any situation.
First of all, being close
to the end consumer.
A lot of people who-- especially
large companies try to create
products from an ivory tower.
They send out surveys
and focus groups
and whatever trying to
figure out, what's the trend?
They read reports.
And I think they're
already from then
they're behind the
curve versus everyday
engaging with the
consumer, and knowing
what's out on the market,
and listening to their needs
and wishes.
So we do tons of community
work in person to meet people,
to talk with them, and
being in that interface.
So whatever you're
trying to build,
the more time you can
spend or actually even
be the consumer, who--
I think I am as well-- is
everyday using these products
myself, the easier the R&D is.
And the more removed you are
from the end consumer, target
consumer, or the
lifestyle, or the industry,
whatever, the
harder it is, right?
Sometimes you can get
too close to it, yes.
But nevertheless, like the
closer you are to interface.
So I could come out with 20
to 30 product ideas in an hour
just by looking at my own
lifestyle and different parts
of my day, week,
month, year, and figure
out where the gaps are where
I need optimal performance.
So where do I need a boost,
an enhance, a support.
And it would be so easy.
And then you kind of
pick your battles.
What is easy to execute?
What has big upside?
And then the other thing
that very few people
have besides the customer
proximity or the customer
interface with
products is that they
think they have to be right.
And I think even our best
products, our currently
best-selling products, have gone
through multiple iterations.
And I think if you
remove your ego,
and you just have,
hey, I have a thesis.
This is what I hope to get;
eye health, gut health.
I think most people,
their gut is messed up
because of A, B, and C.
And this time of the day
they need support.
Hey, this is my idea.
Let's bring this, like
make healthy lemonade,
whatever it is.
And then you try
to innovate for it.
And then you come with
the concept to the market.
You let people try it.
They give you feedback.
And then you iterate.
Most large companies,
especially they
want to get the product to
be so good from the get go.
And probably Gmail
or something like
that has gone through
seemingly, so similar,
gone through hundreds or
thousands of iterations
over the years, right?
And that's just how it is.
And I think most people try
to get a perfect product
from the beginning.
And that's a big failure.
So we have a big
direct to consumer
business, besides
the retail business
with Whole Foods, and
Erewhon, and Sephora
and whoever we work with.
But with that online
kind of like email
list and our community, we can
test products really quickly.
And within like 30 days, we
saw how many people bought it.
We can send them a survey--
ask them what they think.
In 45 days to 60 days, we know
how many people of those repeat
purchased.
And then we already have a
good baseline understanding
on how to make it better.
So being really
close to the customer
and not being scared to fail,
or be ready to iterate-- like we
assume that we will
not get it right.
And we assume that we need
to tweak it and amend it
over the--
and we also assume that some of
them, like half the products,
will be discontinued
at some point.
You're more likely to
create more innovation
versus if you're
always scared to fail,
then you're kind of frozen,
and you try to perfect it.
So I don't know if that helped.
AUDIENCE: I got
here a little late.
So I don't know if you
covered this already.
TERO ISOKAUPPILA: That's OK.
AUDIENCE: What was some
of your biggest challenges
to like growth in
the early stages?
Like getting your
first customer,
what did that look like?
What did you-- what should
you have spent more time on?
What should you
have deprioritized?
I guess getting through
that initial hurdle where
no one knows who Four
Sigmatic is, suddenly
you have your first customer.
What does that look like?
TERO ISOKAUPPILA: Sure So I
started the company in Europe,
and then when I
brought it to the US.
So I kind of had to go
twice through the process.
When I was first getting the
first customer in Europe,
and then I came to the
US, and nobody cares
about what you did in Europe.
Americans just
don't care at all.
So you kind of
have this restart.
So when I started in Europe,
it was actually really easy
for me to get the
first customers,
because I was in that industry.
And I had tons of friends.
So the first 50
or 100 people, it
was just like friends, people I
knew, which is really valuable,
because you could really
get feedback really quickly.
But it was a lot
harder to scale.
So in Europe, it was easier
to get initial traction,
but then harder to scale for us.
And some of the things I spent
a lot of time focusing on
is the ingredient and sourcing,
which is like the geeking
out part.
And unfortunately, most
consumers don't care.
But it was important
for me to know that I
have the best raw materials.
I don't regret it, but it
definitely took a lot longer.
The second thing is that I
didn't raise venture funding.
I didn't have capital.
So even if you had success, just
by not having a lot of cash,
you have to kind really
slowly chip away.
And that was a big
hurdle, having patience,
because as an entrepreneur,
you want everything
to happen overnight, and
just crush it and kill it.
And when you didn't
have cash, and you
had a big dream of getting
people to drink mushrooms,
and nobody drank mushrooms,
it was like really hard.
So having patience.
And then figuring
out how to scale.
I had initial traction,
but how to scale
was really difficult
in the beginning.
And then if I say
something other than that,
it's like the
flavor was something
that we focused a lot on.
And if you don't have a food
or beverage product, just
the user, ease of
user experience
is kind of maybe the touchpoint.
I was so obsessed with the
technology and the ingredients
versus not enough with the
flavor and the ease of use
straight out of the gates.
And then when I came
to US, the challenge
was being an immigrant.
I have lived in
multiple countries,
but this is the only
country where I really
felt like it was hard
to open a bank account.
Everything was so difficult.
And that took a lot of time.
And it was harder here to
get the initial traction,
but then when it scaled,
it scaled more beautifully.
There's just one language,
one currency, versus Europe
is multiple
languages, multiple--
it's legally just a hassle.
The US, it was just
easier to scale.
And I'd already thought
about that scaling.
And what I would have hoped
I would focus even more on
is the thing that people
think we did really well,
but I just think you can
never do it well enough is
storytelling and community.
And if you ask people
in the industry,
they often know that we
build an awesome community.
But I wish I would have
even doubled down on that,
and maybe focused a
little less on kind
of the minutia of
just like retailers
and caring about
the industry stuff.
The B2B stuff, I should have
focused even less on, and even
more doubled down on
community and storytelling,
and get those made even better.
AUDIENCE: So I want to sort
of silo in on one point there.
So what would you say
was your best growth
channel in that early stage?
Was it content?
Was it building a community?
Was it Instagram?
TERO ISOKAUPPILA: Oh, yeah.
OK.
So purely growth
marketing-wise, our success--
because we didn't have
money, and I couldn't do any.
So there's three types of media.
There's paid, owned, and earned.
We mostly killed it with the
earned and through influencers.
It's because your favorite
health influencer's
favorite influencer probably
used our products, still today.
If you think of the
person you go to
in health advice, whoever
they go to for health advice
use our products.
And through that we have
this constant credibility
and support from people
that really matter.
And that helped us
grow into one phase.
And then soon after
that, we started
winning with like podcasts.
That was a big thing for us.
It's because podcast
allowed long-form content.
Our topic is not easy.
It's not bullet-sizable.
You can't sell it easily on a
20-second, 50-second Instagram
story or something like that.
It requires deeper
explaining, and trust.
It was like, hey, mushroom
coffee sounds gross.
I definitely don't
want to try that.
But if somebody you
trust says, it actually
doesn't taste like mushrooms.
And it makes me feel awesome.
You should try it.
You're more likely to try it.
So on the kind of second
wave long-form content
really worked well for us.
Predominately
podcasts, but also long
email marketing blog posts,
other educational forms,
but especially podcasts was--
I think still podcast
is so undervalued
as a form of growth way
for any product or service.
AUDIENCE: Thank you.
AUDIENCE: Yeah, I found
out through Tim Ferriss.
TERO ISOKAUPPILA: Oh, cool.
Yeah.
AUDIENCE: So I'm
curious how-- you
were talking about
sourcing, and then
you also mentioned how large
scale mushroom production
kind of lost its nutrition.
And then I was also
thinking about--
I've read that truffle
production is down about 99%
over the last 100 years
due to too much harvesting
of wild truffles.
And they're hard to grow
and mycorrhizal and whatnot.
So how do you view sourcing
and maintaining quality
and the sustainability thereof?
TERO ISOKAUPPILA: Yeah,
definitely, again, a topic--
thanks for asking.
I don't think a lot of
people focus on that.
There's a lot of foods
that have become popular.
Let's say, chia seeds
or maca, and then
suddenly people are like, we
can't actually produce that.
The internet kind of made
a few things really popular
really quickly, and agriculture
is a slow moving thing.
It's like it doesn't
change overnight.
You can't just-- physical
agriculture doesn't-- you
can't just--
it takes a long time.
And farmers usually are
risk averse a little bit.
It's like they're not
going to change their plans
because Instagram influencers
want to sell chia seeds
or something like that.
So with mushrooms, about 1/3 of
our mushrooms are wild-crafted.
2/3 are grown on logs.
And the wild-crafting
is the harder part.
And the log growing
is the easier part,
because it's a super good yield.
So $1 per square
feet is really high.
So you take trees that are
already dead, because that's
their natural habitat.
A lot of these mushrooms grow
on dead or decaying trees.
You drill a hole.
You put a spore in.
It will grow mushroom that you
can-- for that square foot,
you can get a lot of money.
So there is-- that part is
a little easier, especially
when you talk to
people who understand
what mushrooms to grow.
And mushrooms are extremophile,
so they grow really easily.
You just give them
the right environment.
So that 2/3 part was easy.
Wild-crafting was the
harder part, right?
Because you have to
actually-- somebody
needs to go to the forest
and pick up a piece of chaga
to get this.
And I could talk
for this for hours.
The one benefit we had is
Finland is a small country,
but it's bordering--
I used to have
one of the biggest
economic borders in the world
between Finland and Russia.
And Russia, starting
from Finland,
they happen to have the
largest forest in the world,
called taiga, T-A-I-G-A.
And that's a forest the size
of the United States.
So one forest, the size of
the United States, right?
And that forest is predominantly
perfect for a birch tree
that happens to grow chaga.
And it happens to grow
pretty much everywhere.
And you just need to kind
of know where it grows,
and how to collect it.
But it's more like
education on harvesters,
and telling them where to
get it and how to get it.
That was like operationally
a little bit more difficult.
But yeah, it takes
a lot of thinking,
and most people
don't focus on it.
They just read on a blog that
acai berry is good for you.
And then, let's say, acai berry.
And they don't ever think
about the supply chain
until they're much
later in the process.
And even with collagen
right now, there's like--
most collagen brands, they don't
have enough collagen to sell,
because collagen
has become popular.
And I don't know if you
know how you make collagen,
but you basically usually boil
like the hides and the bones,
and you kind skimp the
cream from the top.
And it's like quite the process.
And it was just a waste
product before, kind of.
And now it's become like
every beauty person is trying
to use collagen.
Every athlete is
trying to use collagen.
The demand just
went sky high in a few years.
And people are like, hey, we
don't have enough of this.
So now they have to
try to figure out,
how else can we
produce collagen?
So yeah, most entrepreneurs
don't think about that.
So thanks for asking that.
AUDIENCE: Thank you.
TERO ISOKAUPPILA: I
love this, by the way.
You can throw it.
AUDIENCE: Thanks for your talk.
It's been really interesting.
TERO ISOKAUPPILA: Yeah.
AUDIENCE: How do you go
about picking which mushrooms
are going to end up in the
tea products or the coffee
products?
And how do you figure
out what the benefits are
that you can advertise
associated with the mushrooms
that you've picked?
TERO ISOKAUPPILA: Sure.
So that's actually easier
than with most food products
with mushrooms, because
you have to cook them,
because they're
not available raw.
It's like a rock.
There's a few outside
if you want to try them.
So you have to cook them kind
of like you do bone broth.
So you do this like decoction.
So you cook it for a long time.
And because you can control
the temperature and the amount
of mushrooms, you
can standardize
to a certain strength.
So it's almost like
cooking it for days
to standardize it to a
certain strength of coffee.
And it's a very
easy lab test just
to make you have a
strong enough tea.
So some years you have
to use more mushrooms
than other times, and
sometimes you use less.
Sometimes you have to
cook it longer or shorter.
So you can just
control the process
to get a standardized output.
So yeah, actually, that part
is quite easy to engineer.
But you just need to-- sometimes
you put more mushrooms.
So sometimes we're more
profitable than other times,
I guess.
That's the other way to say it.
Sometimes it costs more to make
that cup, and sometimes less.
AUDIENCE: And then
for figuring out
what the health benefits are,
is that like historically based,
based on traditions?
TERO ISOKAUPPILA: Yeah.
And if I may comment
on that, that's
a common theme that I
hope us as consumers
will be more educated on.
We want everything standardized.
And I don't think
nature works like that.
Our product is
standardized, but I
would hope that we as
consumers can accept the fact
that sometimes the nutrient
density of a food we buy
is higher or lower depending on
seasonality and what you eat.
And I think us expecting
always to get the same flavor,
same result is forcing us
to eat actually worse food,
because then the producers have
to produce a product like that.
The apple always
tastes the same.
And nature doesn't
work like that.
So if we're can accept
some variability in flavor
and nutrient density, as long as
we know the baseline sourcing,
that would be actually better
for the world than always
expecting the chocolate
to taste exactly the same,
because even chocolate
has seasonal variety.
But to your second question
about nutrient density.
So the benefit of
mushrooms is that about 40%
of pharmaceuticals
use mushrooms.
So there's a lot of research
funding for fungal research.
Unfortunately, there's not
a lot of research funding
for whole foods.
So of all foods, even let's
say blueberry, which is people
generally-- everybody
knows it's healthy.
And it's been a long time.
It's researched.
There isn't that much
research on blueberries.
Because who would fund that?
There's no economic interest
on blueberry research.
If somebody
researched blueberry,
they want to isolate a compound,
an anthocyanin in the blueberry
that is good for
eyesight, and then we'll
brand it as the
Alaskan anthocyanin,
and then we'll put it in
supplements and sell it.
So whole food
research by and large
is so limited versus
something that you can patent,
because you can't
patent whole foods.
But lucky luck,
because mushrooms,
there is a lot more of them.
I would recommend if you want
to look at any food product,
PubMed is kind of a database
for various research.
You can put the Latin
name of any food.
You can get roughly
the amount of research.
The fact that there is
5,000 research papers
doesn't mean it's healthy.
The most researched
fruits in the world
are tobacco, number one,
and marijuana, number two.
Soon after that you get to
things like lemon and ginseng
and other things like that.
So it doesn't guarantee
if something is well
researched that it is
healthy, but it gives you
a pretty good oversight
of what it is good for.
Mushrooms, shiitake,
reishi, things like that
are very well studied.
So you look at their
general research,
and you figure out that they're
good for like maintaining
blood glucose levels.
They're good for gut health.
You kind of like give oversight.
And then we make, first,
just to be safe side,
we make puffery claims.
So instead of
saying that you will
be smarter when you
consume our products,
we say, hey, this is like
a hug from your grandma.
And then you can do the rest.
But yeah, it's baseline
on just hard science
on a genus of anything.
And then looking at what
it is generally good for,
how well it's researched,
who researched it,
how they researched it.
And then you kind of try to
apply it into a food product.
But yeah, I mean,
just unfortunately,
there just isn't a lot
of whole food research.
You can't own that research.
You can't patent it.
AUDIENCE: Right.
TERO ISOKAUPPILA:
It's a challenge.
Throw it.
AUDIENCE: There's one
if you want to ask.
AUDIENCE: I'm curious to know
about your mushroom diet.
How do you use these products?
And what kind of
mushrooms do you use?
And how do you cook them?
And all that kind of stuff.
TERO ISOKAUPPILA: So I don't
answer that question partly
ever, including I
don't answer how I eat,
because people want a shortcut.
And how I eat is not
necessarily how you should eat.
Or how I use mushrooms
is not necessarily
how you should use mushrooms.
Also, how I use mushrooms
in February 2019
is not necessarily
I'll use them in March.
March is a busier month
for me than February.
So maybe when I'm busy, I
have to use different things
to support my busy
lifestyle, right?
I had that one
slide somewhere here
to give you a rough
idea of time frame.
So generally speaking,
you don't necessarily
want caffeine in the morning,
because your cortisol already
spikes.
A lot of people
love it as a method.
But you naturally
should be energetic.
You should probably go outside.
Get some fresh air.
Maybe move a little bit.
But you want to hydrate.
And you probably
want antioxidants,
like a shield, a body
guard for the day.
So mushrooms like
chaga and shiitake
that have a lot of SOD,
Superoxide Dismutase.
It's this super antioxidant.
Using things like that might
be really good for the day
to kind of get started.
And then in the afternoon when
you need a little pick-me-up,
using something like
a Lion's Mane that
boosts cognitive function,
or using something
like cordyceps that gives
you energy without caffeine
or sugar might be a good
idea when you naturally
get that little dip
in the afternoon.
The best scenario is you
taking a nap or siesta.
But if that's not
possible because of work,
maybe try something like that.
And then in the
evening time you want
things that support somehow
kind of a calming down process.
So reishi is used for kind
of like the endocrine system.
The [INAUDIBLE] acts as
kind of calming your body.
It's known as the
Queen of Mushrooms.
Maybe it'll help you
reach deeper sleep.
And then shiitake could help
with phase 1 and 2 liver detox.
That often happens overnight.
So that might be a
good strategy if you
want to cleanse your liver.
The liver is kind of a mirror
of the skin health as well.
So there are different
times how you can use it.
I just never answer
how I use it.
You just have to
figure it out yourself.
I know it's not the
answer people want,
because they want a formula.
Do A, B, and C. But maybe
that gives you some framework.
AUDIENCE: Yeah, I wasn't
looking for a formula.
I was just curious
how you apply it.
TERO ISOKAUPPILA: A lot.
Different ways.
And yeah.
And high quality.
That's my three formulas.
AUDIENCE: Thanks.
TERO ISOKAUPPILA: But
variety is useful.
Even if you have an adaptogen
you can use everyday,
variety is awesome.
So even with dark leafy greens,
even if arugula is awesome,
or dandelion is awesome,
try all kinds of greens,
and just kind of
mix and match them.
The same with mushrooms.
It's beneficial to
mix and match them.
And so even though I'm
not a fan of portobello,
you can still have it.
Just get different
varieties into your system.
And the more variety you
have, the more intelligence
you're getting from food into
your cells and into your DNA.
Yeah.
AUDIENCE: Sorry.
I might have missed this when
you were talking about scaling.
But in terms of the timeline,
I was wondering what was the--
how long did it take for
you to go from zero--
or not zero, but
like a product idea
to get a packaged product
ready for the market?
TERO ISOKAUPPILA: It took
about two years the first time,
because you have to solve the
operational challenges, which
is harder for me than
the product concept.
So the first time
sourcing ingredients,
getting a partner who can
make the packaging, that
took a lot longer than coming
out with the vision and the use
case.
So that was easier for me.
But maybe for another
founder, it's different.
But if you've never done food
or beverage manufacturing,
I highly recommend
having patience
that it might take a lot
longer to actually get
the product produced
than you think.
If you have a donut
that everybody--
all your neighbors
love your donut.
And your friends and
family are saying,
you should make this donut.
It's a hit.
It's a great donut.
And then you figure out that
you've been making at home,
and now you need an
FDA-approved commercial kitchen,
or a contract
manufacturer to make it,
it could take a lot
longer than you think.
So it took about two years
to get the first version out,
partly it was my--
like not just-- me just not
knowing enough of the details.
It probably takes about
a year normally just
to have every
paperwork in order.
And for me, it
took two years just
because I didn't
know all the details.
AUDIENCE: And did you have
to do most of it yourself?
Or are there like
contractors that
do a bunch of different
steps for you?
TERO ISOKAUPPILA:
I had to do most
with myself and
my founding team,
because nobody had
done what we did.
Nobody had done a dual
extracted wild-crafted mushroom.
Nobody had done it.
So we had to figure that out.
Nobody had done these
packaged mushroom beverages.
They were sold in capsules,
or in big round bags.
So I had to figure out
how to put these mushroom
powders in packets that look
almost like Emergen-C or a tea
bag that you can just pour
in a cup and add hot water.
I had to figure out
that kind of stuff.
And that was it.
But if you ever think of
doing a dietary supplement,
there's like hundreds of
companies that can help do it.
If you want to make
a beverage yourself,
there's hundreds of
companies making it.
I would just highly recommend,
don't outsource R&D and IP
fully to someone ever.
Even if you use their
resources for certain things,
always have really engaged--
you or someone else in the team
really engaged in that process,
so you know, A, how it's done.
So it's easier for you
to sell and market it,
because you know
it's like, hey, how
is this natural
orange flavor made?
Is it squeezed from an orange?
Or how do we get this orange
flavor into your product?
That's like a question
somebody might ask you.
So you know the answer.
But secondly as well, it's like
then you own the technology.
Because in food and
beverage, there really
isn't the same way code or
technology that you have in IT.
So be really engaged.
And there's definitely
a lot of resources
for beauty, skin care,
protein, food and beverage.
Just for me, there
wasn't, because nobody
had done what we did.
AUDIENCE: We have time
for one more question.
TERO ISOKAUPPILA: OK.
Last one.
AUDIENCE: You're nervous
when it comes at you.
You have to catch it.
So you've talked about
mushrooms breathing and eating
and being a smarter food.
Are you saying
that mushrooms have
like a type of consciousness
that is measurable?
TERO ISOKAUPPILA: Yes, that's
what I'm exactly saying.
And you can measure it.
And they've measured
it multiple times.
They've put mushrooms in a
maze, and funnily enough,
the mushroom finds its
way out of the maze.
They put mushrooms
to figure out how
to build the subway
system in Tokyo,
or actually the railway
system in the UK.
And the mushroom figured
out how to build a railway
system more efficient than
what humans had built.
So yes, it is measurable.
I also think that the most
interesting intelligence
that mushroom have of
global consciousness
is not measurable.
And we have no clue of it.
And I think we will
not have a clue of it
for a long, long time.
And that will be a whole other
talk about the consciousness
of mushrooms.
But yes, I think
they're a higher being.
I'm just leaving you with
a nugget, planting a seed.
It's that mushrooms almost
always live with bacteria,
and bacteria almost always
lives with mushrooms.
So right now in
your body, there's
about 10 times more
bacteria than you
have cells in your body.
And there's a lot of cells.
And almost always this
bacteria lives with mushrooms.
If you take kombucha,
it's a symbiotic organism.
Basically, brewed black tea
with a little bit of sugar
that interacts with
bacteria and fungi.
If you think of fermented foods,
sauerkraut, kimchi, whatever.
And right now, we've
talked about how
your gut is your second
brain, or your first brain.
How we talk about
your gut instinct,
your spider sense, how
you just know something.
You can't explain it in
words, but you feel it.
You know it.
And it's often related
to your gut biome,
which is now a big
research topic,
and how that gut
biome is actually
tied into probiotics
and prebiotics,
and how those prebiotics live
with the bacterial kingdom
and the fungal kingdom.
And they have knowledge that
we have yet to figure out.
And I think that knowledge
is much greater than us.
And they found mushrooms
growing at every level
of the atmosphere.
Mushrooms can survive in space.
So they've traveled a long
ways in different places.
And I think I'll probably--
I don't think during
my lifetime we'll
figure out that intelligence.
But I do believe that
one of the things that
will happen during my
lifetime is we'll find
the seventh kingdom in biology.
I think there will be a new
kingdom that is not named yet.
And that kingdom will
be somehow related
to the yeast or the
collaboration between bacteria
and fungi.
And we'll figure out a new
kingdom lives on this planet.
Because back in the day,
there were not six kingdoms.
There was two, and
then there were three,
and then there were four.
There's five.
Now there's six.
And we think biology
has come to its end,
and there are six kingdoms.
And I think-- my belief is
that we'll find a seventh one.
And with that,
thanks for coming.
And I appreciate you
sharing my knowledge.
AUDIENCE: And Tero,
really quickly,
where can people find you
and more about your product?
TERO ISOKAUPPILA: Yeah.
We have a-- the easiest is
actually-- if you're here,
we have a shop on Abbot Kinney
called the Shroom Room that
serves free beverages.
I know shit here at
Google is free as well.
But if you want to
walk on Abbott Kinney,
you can get a free
mushroom tonic anytime.
We are also on all
social channels.
@FourSigmatic,
F-O-U-R-S-I-G-M-A-T-I-C.
I'm a little bit
hard to find, but I
have a really bad
Instagram called IAmTero
that you can follow
my adventures.
I post rarely, and randomly.
Sometimes good stuff.
Sometimes not so good stuff.
That's kind of where
you can find us.
But stop by at Abbot Kinney.
You can find us on Whole Foods,
Erewhon, different places,
here as well if
you want to buy it.
Amazon.
FourSigmatic.com.
We'll figure it out.
Anyway, thank you.
[APPLAUSE]
