Startup Q&A is an interview series showcasing early-stage health, fitness, and wellness companies.
In this Q&A, we hosted a discussion with Kevin Moran and Matt Lombardi, co-founders of beam, a wellness company offering subscription-based CBD, nootropics, and other organic supplements. Kevin and Matt tag-team our interview, covering everything from lessons learned on day 0 of their company to CBD’s place in a larger health and wellness economy.
Can you tell us about what you’re working on at beam?
ML: beam is a Boston-based wellness company with a mission to help people improve their bodies and minds through all-natural functional products that use rigorously tested, THC-free CBD, adaptogens, nootropics, and electrolytes.
How did you come up with the idea? What key insight led you to pursue this opportunity?
ML: Kevin and I met at Boston College and reconnected after both pursuing careers in professional athletics. We started training together for an IRONMAN and began experimenting with CBD to help manage our preexisting injuries.
As former athletes, we both have always been super cautious about what we put into our bodies. As we started exploring options, we realized there was an overwhelmingly large amount of interest in CBD but equally, if not more, a lack of trust in it.
We saw an opportunity to bridge that gap with the right brand and right products made at the time.
How did you turn your idea into a company?
KM: From day one, you’ll be met with some type of uncomfortable situation. For that, you need an oversized amount of optimism. Always. Early on, it’s less about how smart you are and more about how much resilience you have.
ML: You always hear how many people get paralyzed to start. Kevin and I share a strong bias towards taking massive action. You start taking action and, half the time, it’s wrong, but you pay attention to the results you’re getting. The things that work, you keep doing. The things that don’t, you pivot and do something else.
KM: One thing that worked for us was that we had a ton of conversations with a variety of people within the industry and honed in on the information we saw most valuable. Following the science, we hired a cannabis professional, Max Poling, as our director of innovation to help us create the highest quality products possible.
It was still early in the CBD market, so we launched with a tincture and a topical lotion. In the beginning, we purchased a folding table online and were promoting it on the streets in Boston, selling it to anyone who would talk to us. We’d pop up at CrossFit gyms, juice shops, and other local retailers too.
How big can this get? What’s the addressable market and how do you go about capturing it?
KM: The beautiful thing about beam is that we play in a lot of different markets. You could argue that we are tapping a big part into the sleep market because of our product offering focused on sleep.
You could also argue that we are in the CBD market, and that’s the one that presents the biggest opportunity for us right now. It’s valued at $5–7B right now and projected to reach $25B over the next five to six years.
A rising tide will raise all ships, but what’s going to make a standout company in the space is one that educates and differentiates by creating good content and aligns with quality partners.
However, we’re really not a CBD company; we consider ourselves a health and wellness company, which is an even larger opportunity. We’ll continue to be a big player, or a big fish in a smaller pond, as it pertains to the CBD category but also focus on becoming a bigger fish in the larger health and wellness company.
Who is the core customer? How are you acquiring customers? And how will you grow the customer base?
KM: We’d like to think we are on the cutting edge of health and wellness, and our customer is looking for exactly that. They take their health and wellness seriously and are looking for what’s next. For instance, a lot of brands are starting to use functional ingredients, like mushrooms and adaptogens, in their products, but few find ways to also incorporate cannabinoids.
We are a digitally native brand, so owning the relationship with our customers has been most crucial in gaining traction. People always focus on acquisition, which is obviously important, but what’s key is repeat customers and retention.
For that, we invested in an awesome director of customer experience who keeps us updated on what our customers do and don’t like. His help in developing a direct line to our customers has been a game-changer.
Pretty much any digital channel you can think of, we have either tested or are doing something with to spark new growth — and we think digital has a very high ceiling.
We do plan to become omnichannel in the next one to four years, but we have a long way to grow before that.
Looking at your road map, what are some of the milestones you’re targeting over the next 3-6 months?
ML: We will definitely continue to build a world-class team and attract new talent. We were also pleasantly surprised in 2021 with how many subscriptions we were able to acquire, so we plan to lean into those metrics for 2022.
Regarding product and innovation, if we’ve done anything well over the last few years, it has been listening to our customers. We have direct relationships with a lot of our customers, and they give us feedback on where we should innovate in the market.
We will also have a few product launches in the next year, but that’s all we can share at this time.
Anything else you’d like to share with readers?
KM: As a startup, there’s value to raising money from an economic perspective. But, really, startups are all about optionality.
When you’re figuring out how much cash you need to get you through year one, you’ll want to have five options available to you on how you steer your business. As a founder or entrepreneur, the trouble starts when you make decisions that limit your optionality in the future.
We’ve been thoughtful and careful in making decisions six to 12 months out. It’s important to be in the weeds with your team but also be thinking a half or full year ahead to capitalize on your business.
If you’re interested in having your company featured in our Startup Q&A series, send an email to email@example.com.