Our guest today is Matias Muchnick, co-founder & CEO of NotCo – A Chile-based AI-driven food technology company that is redefining food. They’ve raised over $110 million dollars, including a big investment from Jeff Bezos! So, you’ll want to be sure to stick around until the end to hear all about what how NotCo is using AI to make vegan meat, milk, cheese and other products that are vegan but look, smell, taste, and feel like they are not vegan.
Matias first realized that he wanted to pursue entrepreneurship in the consumer foods space after being in investment banking during the early stages of his career. He went on to create an app called chooz that was meant to reward healthy living behavior, which ended up failing. Almost two years later, he moved on and decided to start Eggless, this was Chile’s first food company to develop and launch healthy plant-based foods in traditionally animal based categories. That experience led him to travel to the United States to learn more about data science around food, and he would eventually start NotCo, which is a Food-Tech company based in Chile that leverages artificial intelligence to quickly and accurately develop plant-based foods that appeal to the mass market.
Ash Faraj 00:02
Hey guys, it's ash here Now today's guest is Mateus muchnick, co founder and CEO of not CO, a la based AI driven food technology company that is redefining food, a concept I found so fascinating that I thought we have to get them on our show, they've raised over $110 million, including a big investment from Jeff Bezos, you want to be sure to stick around until the end to hear all about how not CO is using AI to make vegan meat, milk, cheese and other products that are vegan but look, smell, taste and feel like they're not vegan. But before that, we want to take you through my thesis career journey from beginning to present. So settle back unwind enjoy this fascinating story. We are joined today by Mateus muchnick, founder and CEO of the knot company and artificial intelligence based food company that makes food that's all vegan for example, they make what's called not milk, but it really isn't milk. It's just vegan. Hopefully I'm saying that right. But that's really cool. And it's also backed by Jeff Bezos, which I thought was really fascinating. Mateus Welcome to the show.
Matias Muchnick 01:07
Thank you, Ash, thank you for having me here.
Ash Faraj 01:09
Hopefully I hopefully describe to describe the company right?
Matias Muchnick 01:12
Absolutely. You have a better elevator pitch than I do so.
Ash Faraj 01:17
Right on, I'm in a high school classroom with you with us who is Mateus?
Matias Muchnick 01:21
If we're in a class, probably I'll be misbehaving, you really. So I had, you know, an important attention deficit. When I was a kid, I couldn't concentrate. So I'll I'll be disturbing all the time professors and I was the guy who was, you know, professors change seats all the time constantly and, and so on. But very happy, genuine guy, outgoing. Very, you know, sports, Greven, I love sports. And I've always been doing sports. And
Ash Faraj 01:54
when I bring up your childhood, what emotion Do you remember feeling most frequently?
Matias Muchnick 01:58
I think it's recipients. I always know the highest IQ guy, I wasn't the best at, you know, or the talented guy who you would you know, find in a team, but I was probably the hardest worker, always. So resilience was, you know, it's kind of a very good concept to define my childhood, because of my dad's work, also lived in Argentina, came back, flew to the US came back. So I was constantly constantly, you know, exposed to other cultures all the time. And yeah, moving around, when you're a kid is not an easy thing, right? You have to adapt to new friends to build up your own kind of like identity. You know, wherever you go, you know, you have to tell everyone who you are.
Ash Faraj 02:41
Fast forward a little bit you did your undergrad and your masters and szalay. Right. kind of curious why initially did you choose to I think it was business business or business administration and economics. What made you choose that? Was it just kind of random, just out of curiosity?
Matias Muchnick 02:53
No, I was born in a in a finance family. And my dad, you know, was constantly constantly speaking the finance language when we were like three years old. So I was very related to the finance side and my role model speaking, my older brother also went to business and economics. And so I was dragged to it, it's not that it fascinated me in any way. But you know, I had good relationship with maths as much as I loved biology, but biology or you know, even my mom is a photo photographer. So she's an artist, but none of us actually kind of like graded or went through that path. We like the three brothers. It's kind of boring, like the three brothers went to business and economics. So I was born you know, in a family very finance driven so I guess, you know, kind of like story repeated itself with different angles, right? My my older brother, he's, he's way more into the numbers than I am. I am more creative. My underbelly is more reflexive. So it has to do with some, you know, kind of like my, my mom's you know, the youngest brother always is closer to mom. And it's mom's favorites. He has more of the creative aspects. Yeah.
Ash Faraj 04:04
What was it? Do you remember your first experience at a college what you did?
Matias Muchnick 04:06
Yeah. So Lorraine is, is the one who put it in some way. Like the fanciest asset management company in China, though, I did my internship there. It was a great, great, great, great experience, even though we was fancy, I worked in the darkest corner of the office, you know, serving coffees and stuff like, like internships wearing that bus. You know, I think they're totally different, right. But it was a great experience because kind of like took me out of the comfort zone. I was very used to kind of like, being the main character of stories and I wanted to sell as outgoing as I am. I always wanted to be kind of like the center of the conversation and CES kind of like took me out of it. I was so far away from and it was a great, great experience. I was so proud to get in because it was not easy. I learned a lot especially What know about the things that I didn't want to do when I grew up?
Ash Faraj 05:03
What was it that you did not want to do?
Matias Muchnick 05:05
literally cut off, like, dedicate my life to finance. I was like, This is not moving me in any way. Finance was boring. Yeah. And that was my first experience. Wait until we covered the second one.
Ash Faraj 05:23
The next one is JP Morgan, right?
Exactly. This was this was actually a little bit more interesting because it was in Hong Kong. So I went to Hong Kong. And I had, again, another internship program. This was super interesting, because I was in the private banking side. So I got to relate myself a lot with families that have created wealth in different manners, right. And this is where the intrapreneurship kind of like dive really got to me. And in this is the story, when you're in private banking, you kind of like have relationships with a lot of families, you relate a lot with them, you hear what they want, right? You hear what they want their families, there's family dynamics. And this is where I kind of like really, really asked myself what I wanted to do in this life. It was because whenever I talked to a particular head on the family that created their wealth route intrapreneur when they told the story, their eyes shine, they stories were magnificent, doesn't matter that what they did they tell they changed the world in you know, in some way or another. So I said, I want to be that, like, I want to be telling the story. Like this guy's not like when I when somebody asked me what I do, I just make rich people richer right now. That was basically my, my main job. And that wasn't fulfilling in any point, right? But when I heard the stories about this intrapreneurs I was like, wow, like, I really want to tell a story like this to my kids. That's where I said, literally, I don't want to go into this finance life. And I want to, you know, create my own first startup. I didn't know what you know, to disrupt. I didn't know what that time. So then the story or the very beginnings of my relationship with food comes into play.
After Mateus discovered that he wanted to pursue entrepreneurship in the consumer food space, he created an app called choose that was meant to reward Healthy Living behavior. Now, almost two years later, he realized that it may not be the best idea to build something sustainable. And so he decided to start eggless. And this was Chile's first food company to develop and launch healthy plant based foods. And traditionally animal based categories. Think about vegan burgers or vegan milk. That experience led him to travel to the United States to learn more about data science around food, and he would eventually start not CO, which is a food technology company based in Chile that leverages artificial intelligence to quickly and accurately develop plant based foods that appeal to the mass market. It simply says, through your experience at JPMorgan, you became inspired, okay, like I know that one day I want to be able to tell a story like this, I want to be able to, to do something that's moving this meaningful, that makes a lot of sense. And then at what point did you decide that I'm gonna make that leap,
I knew that I wanted to do something related with food. As I said, You know, I was a rugby player. And one of the most important things in your performance is food. I really was a curious guy. And I experimented a lot of things. And none of them actually worked in I had a very hard injury playing rugby. So I came here actually to New York to do some surgery, you may hit and it was in that darkest moment, couldn't walk for three months, it was like painful, both physically and mentally, right, especially mentally. So I was one on one of those days, that you are kind of like in the darkness, questioning yourself. Why are you going to do in this life that we get? Or they all want to know the chance that we get? I said, you know, what should I do? Food. Food is one of the things that moves me around that. That really, I don't understand that one day I hear that eggs are good for you. And the next day, eggs are bad for you one day meat is good. Then next day meat is bad in so much confusion coming from an industry that is supposed to know what they're selling to a consumer that is becoming more and more disconnected to what they're eating, drinking. So I created tools he was a gave me five up looking backwards, it wasn't going to work at all. I was a very like, kind of like rusty enterpreneur because I didn't know how to be an intrapreneur right. So I didn't know how to build a team. I didn't know how to execute, you know, a good business plan or create a nice technology and so on. But it was you know, a year more than, you know, over a year of sacrifice Research and, and failing. That's where I kind of like went into egg less, which is my second kind of like startup. So the first failed miserably.
I'm just trying to think about, you know, your psychology. So in 2012, you so coming to go start choose you go start this app. And at what point did you realize that was a failure? Because I think some for some people might ask, okay, I'm doing this thing and should I keep going? Or should I stop? Like how do you know when it has failed
in your gut? failure comes in different ways. And for certain people, in some ways, and for now, they're seeing other ways, right? To me, it came when I got up in the morning, and I didn't know what to do. I didn't care about it. If it fails, fantastic. taxis. Fantastic. And I was thinking about other startups. And I was like, nah.
So it's less of a, you know, like a logical thing. It's more of like a feeling like if you just don't feel the same excitement, that's, that's when you decided you wanted to move? That makes sense. Okay.
Matias Muchnick 10:57
Yeah, I mean, you can fail for two things, one, because you don't have any money to the operations. And the other one is more personnel. I'm more philosophical, right? That you feel it and you say, okay, doesn't matter, the business is going well, doesn't matter if my priorities and certainly entrepreneurs generally don't do this and sacrifice a lot. And priority is not you like I'm not prioritizing me and my mental health. And that is something super important that we certainly as founders miss a lot. And so doing things that we you don't like, you know, we have to dance with that, you know, lady, we, we definitely have to do things that we don't like, don't get me wrong, in that sense, spiritually, you understand what you're not in love with, with what you created. And that's the moment you have to kind of like rethink and step. You can do steps aside. It's fine.
Ash Faraj 11:49
Yeah, that makes sense. This, this idea of eggless started to formulate kind of before you decided to lose shoe, leave, stop Jews focus on eggless. Just curious, where were you at in terms of your personal life? Maybe like financially, like, why didn't you go back and get a job? Because you thought, oh, maybe this is like really risky? Like, was there any like feeling of like, man, like, should I keep doing this? What if I keep failing?
Matias Muchnick 12:10
Absolutely. No, I was still living with my parents. You know, 26? Yeah. 26 around there. Yeah. I was still living with my parents. I had a miserable salary. I couldn't maintain myself, but but I had the support from my parents. And I think one of the also very underestimated abilities or privileges for an entrepreneur is having a very supportive family. My parents were absolutely supportive. None of the craziness because they don't get it either. Right. What are you doing? Like, what is this app, you know, that you're doing? So kind of like blindly trust in that, that you're seeking for something that makes sense. I was I was there. I was like, I need to get out of my comfort zone as well. Right. So the app was when I was working the up, I was working in my dad's office. Right. So I still was in the comfort zone. And so my post juice experience, the Eglin experience, you have no idea how deep in the mud I got. And that was probably the genesis of North Coast culture
Ash Faraj 13:17
now that that I understand your motivation to start eggless goes all the way back to you know, I want to be able to tell a story. This is so inspiring, and then it goes okay, well, I want to go Okay, food, okay. You play rugby till 2015. You come to the US? I think it was to Berkeley. And then what I read was you wanted to learn how data and science applied to the food industry. So you had a very specific intention when you came to the US?
Matias Muchnick 13:39
Yes, absolutely. So one of the things that I really understood going back to kind of like, why I was so inspired by the food industry to really disrupted I under I wanted to understand the Y. So the Y had to do with something that I lived for firsthand in my egg less experience. So I had no idea how to formulate a product to scale it up what machinery to buy. Imagine we were two guys, finance majors. Buying machinery from China, installed it in my friend's garage, literally was not actually the garage. It was my friend's sister's bedroom. And so we literally created a manufacturing facility in my friend's sister's bedroom. And to create the product. We hired an r&d company that created food formulations for big companies. And that's where I actually understood what was the problem in the food industry. I thought, you know, a narrative, the process of elaboration of a new formulation was going to be made by biochemists, and you know, so much science behind them data and so we wanted to take the eggs out of mayo. So tilian sorry, that there Biggest major consumers in the world per capita. So, you know, that's fun gross facts about Chileans, but Oh, I didn't know that. We everything with media, we don't get creative with sauces we just everything yeah, we hired this r&d company. And you know that technology behind food formulation was three guys in a lab coat in an experimental kitchen, doing trial and error and reading research papers of 1980s on how to apply, you know, soy to replace animal based ingredients. That was it. No more technology, no data, right. And this was a company that formulated products for big companies, right. So it's not that we weren't lost in a company that wasn't compelling in terms of technology and science. It was compelling. But that was the availability and the technology behind an industry. So that's where it kicked in and said, Oh, no wonder we have this foot landscape. Right. So that was kind of like the genesis of, of not go of me moving to the US to study and how to apply science and data to really disrupt the industry, you cannot disrupt a broken system, if it's not with a new technology. And that relates into everything. every industry, not just the food industry. Understanding this right. Not cool was really like a spin off of eggless. Or it was like an It was like an addition not at all I mean, the way we did the way we did things in Agnes Howard, so different to what we're doing in the experience of getting a product scale placed in Walmart placed in the fourth biggest retail chains in Taylor, you know, I had to produce the product myself, I was the cook, I labeled. Yeah, the cases might the the trunk of my car, went to the supermarket, kind of delivered, went back and took their products out of the warehouse and put it on the shelves, it everything. And that gave me kind of like the wisdom if you want over the experience of not only creating a concept, but also creating a brand.
Ash Faraj 17:03
I saw that eggless had like a successful exit. Yes. What is successful exit mean? Like, what does that mean?
successful exit is when you sell your shares eggless was growing, you know, we were in around 1000 stores nationwide, including Walmart, it comes to times when you want to do something else. And that's again, hit me really hard and said, You know, I really want not only to create an eggless Mayo, I want to create a disruptive company that can revolutionize the market.
Like this was an experiment for Naco, essentially,
Matias Muchnick 17:34
for me as an intrapreneur. If you want to put it that way. Yeah, yeah, it was an experiment for me as an intrapreneur, I needed to kind of like, really get into their mind and really understand the system to really then come back with, you know, probably what we're doing and technology with detail. And now I'm bringing a Tesla, right, we needed something else absolutely different.
Ash Faraj 17:58
In 2015, when you went to Harvard to recruit an astrophysicist to join you on the mission? First of all, how did that first conversation go? Like, what would you say,
Matias Muchnick 18:07
was a great conversation I reached out through our friend of mine that Kareem was his professor first meeting was something that I really had low confidence on convincing him to really jump into this adventure, because he first of all had a profile of a researcher and not an intrapreneur. And the second was, you know, he was looking into stars, and, and the space and this, you know, kind of like Milky Way. And I was proposing something that is as simple as food. I talked to Kareem. And whenever I said, you know, the words kind of like, with food, he literally got a lot of excitement, because at the end of the day, anything that you can do in the research space of astrophysics, is very theoretical. It's not that you can taste them, you know, and, you know, feel it right away, like all of your contribution might be right might be wrong with a large degree of confidence. He said, you know, let's jump on this. Because at the end of the day, the rationale behind it makes sense. I mean, we've been failing for 1000s of years plants to animals to generate a meal to eggs and meat. Let's take the animal out of the equation and create our milk, cheese, eggs and meat from plants. The interesting fact was that there are more than 400,000 species of plants in this world. And we have no idea what 99% of them can do. You have no idea the combination of pineapple and cabbage will result in a milky taste, right? Because you have no idea. And you're completely biased as a human being as well, kind of like where we struggle, the angle of what plants to combine in order to generate the things that we love. In the animal based foods, you know, such as you know, yogurt and cheese and burgers. This is exactly what we needed in the food space. We don't understand the food that we eat. We don't understand the world of plants that we have. So how can we actually kind of like hack the system, so
Ash Faraj 19:59
What is Giuseppe
Giuseppe is a machine that is trying to discover the underlying patterns between the molecular components in food and the human perception of taste, texture, smell, and color, what is trying to do to survive is to understand food. The food that we love, right, that are originally from animals are coming from animals in a molecular level. And it's not just the molecular level, we have datasets of molecular, spectral, physical, chemical, sensory information of those products. And then we have 1000s and 1000s of plants that we've screened with exactly the same information. So at the end of the day, what Giuseppe is trained to do is to find implants, a combination that should result in the same molecular structure as the animal based product, the output of disable are basically recipes, what ingredients to combine, how to combine them. So we have a team of chefs that would take that recipe, put it on the kitchen, cooking, and see the end result. And then we have a trained panel that would tell the algorithm This is close to melt because of this, this and that in different dimensions of flavor and experience and stuff like that. So the algorithm says, oh, the color wasn't right, it was a little bit more of a cd consulte. That's where it starts to learn between what the human brain likes from different products, because we like from milk, what we probably dislike from burgers, we don't want a creamy burger, we like a creamy milk. Right? So how can you actually create enough knowledge for a computer to start hacking the human brain? First is the understanding of the underlying pain patterns between data from food and plants with the human perception of the sensory experience. That was it.
So you're telling me that there's a machine that gets smarter and smarter and it can make meat that's not meat makes milk? That's not milk? That's crazy.
The machine doesn't create it the machine kind of like things and tells you what to combine in order to create it. Right? So the ratio, so Exactly, exactly. We've been training an algorithm for five years feedback, data in a daily basis, and many other things as well. Right. So as I told you, that was kind of like the first question of the survey. And that is giving us the chance to produce products faster, better and more accurate than anyone has seen the space with very innovative ingredients. The example of the combination of pineapple and cabbage is true, that creates meal keynotes, that was suggested by the algorithm on today, actually, our product that we have, you know, on the supermarket scale, the combination of pineapple and cabbage, and it tastes like milk. I mean, it's like, wow, I missed this. I didn't see this coming, right.
you know, people like might be like, very skeptical of the taste and very skeptical of like, just like before the I mean, a human consumer psychology, right? It's like, Oh, it's not believable. What would you say to people that are like, does that even taste good? Or like, I don't believe that? Would you say that tasting aspect of it?
I would you know, and I think I'm gonna relate it with it with a story here. So it's hard, right? It's never easy skepticism, especially when it comes to food is something that is very, very high right now. Every day, it's it's less of a constraint. skepticism has been going down significantly in the past five years, and spatially through COVID. The adoption of plant based foods have been exponential. I don't want to go through the branches. But being the best way to actually portrayed our products and get the skepticism down is throughout tasting. So insert tastings for us was the number one driver of sales, people that tried the product bought it and people that bought it 82% of people that bought it repurchased. This is a KPI that, you know, for a CPG company for a specific product is crazy to think about. So the only way to get the skepticism, you know away is tasting the product.
What what's your number one? Like? What's the number one product? Is it the nut milk?
Matias Muchnick 24:01
Currently, it's not milk very, very competitive with a burger. So with a burger we just launched six months ago in to Argentina, Brazil, Mexico, Colombia, in only six months of sales, the product has sky rocketed. And the appeal for plant based burgers is just absolutely massive milk is the number one especially because we are the champions of the plant based milk that tastes like milk because when you think about how many alternatives to milk are 1000 right, super competitive, very common. Yeah, and and, and to us one of the I think I mentioned this at the beginning, but milk is one of those things and plant based fields specifically, that the number one factor of loyalty is taste almost 63% of plant based milk consumers are not happy with the taste or completely happy with the taste of the product that they're drinking right now. So a lot of plant based consumers currently plant based consumers have milk are changing into not Co. And also part of them are dairy drinkers that wanted to live dairy but didn't find something about was tasty enough for them to create the sacrifice, not milk is that it's a plant based product with no sacrifice to switch from cow's milk to non dairy not
Ash Faraj 25:18
you know in 2018 when you were a graduate wanted to ask you the Jeff basil story. can people find this now? Like in the US?
Matias Muchnick 25:25
Yes, we launched in November, nationwide in Whole Foods stores, the two versions of our milk, the whole milk under 2% reduce fat only in Whole Foods right now. Okay, we will be announcing a lot of partnerships. Imagine that we are in 500 stores on the plan is to end up in over 5000 stores by December this year. So you'll be finding out on your see not milk throughout You know, every single channel, the only countries you're selling to is the US and then like your neighboring countries, or is there any other countries that you know us in Latin America we are you know, kind of like regionally expanding we are currently in Tierra, Argentina, Brazil with main operations, and Lansing in Mexico, Colombia and Peru as well. So there are various countries, we're not neighboring with them. A lot of expansion happening. Canada is another that we will soon be there, you'll find us in the US and underworld
Ash Faraj 26:25
in 2018. From what I've read, you know, you're in a graduate program at Stanford, I think it was like some kind of executive program. Yeah. And your professor asks you, who would you want as a business partner? And you say, what the heck, of course, just vasos he just said it in, magically made it happen. Like, how did you get connected with Jeff Bezos and how did you convince him to invest in your company?
I was in postgraduate program at Harvard. Okay, yeah. So then I went to Stanford, and that was at Stanford professor, I was in the office of this professor that we really kind of connected. He was a big fan of nautical. We had a chat. And he said, Come to my office, we'll chat. Let's brainstorm together. I was there for five minutes, when he asked the question, if there's somebody in this world that you want them to be your partner, who would it be? I think I took 0.1 seconds to say two phases, right? I said phases, right? And he said, okay, Challenge accepted. I'm going to try to reach it. I was like, okay, of course, do I want to reach him as well? Right, but right, how can you reach him? And he went through the internet like life in front of me. He got into the bathtub, and he just googled, how can I get to this guy? And he said, bingo. And I said, What? And he said, the person who leads the family office of Jeff Bezos went to Princeton undergrad with me. And I was like, Oh, my God. Yes. I want to be literal here. He sent me an email. It took one day for her to answer Melinda. She was like, Okay, let's try it. Let's go. But I hopped on a call, literally Three days later, send her some products. Two days later, I got an email saying Jeff, like the idea, the attraction and the team. We want to invest. And I was like, no way. I was trying to you know, I should I think I I think I showed it to him to my girlfriend kind of like saying, Please read it to me. It's like whatever.
Ash Faraj 28:30
Yeah. Yeah, that was crazy moment, man for you.
racy moment crazy. So, so happy.
Ash Faraj 28:47
Something I look for when I decide to partner with somebody or hire somebody is
Matias Muchnick 28:52
Ash Faraj 28:53
The most important quality in a leader is
inspiration and execution, the right balance. It's more like walk the talk because at the end of the day, a visionary is a dreamer, an executioner. It's an executive. And the combination of both is a successful leader. At least to me,
Ash Faraj 29:10
something I've struggled with as a leader has been
Matias Muchnick 29:12
human and communication. It's very difficult to handle an organization dealing with both professional and personal aspects. Everyone has their own things going everyone has their own necessities. Everyone has their own dramas internally and it's hard to be handling everyone in the organization the same way somebody interior somebody in Brazil, somebody in Argentina, some brain Colombia, somebody in the US so many different cultures, so many different cultural kind of like aspects that communication is something super, super difficult.
Ash Faraj 29:46
One setback or failure in my early 20s that I will never forget is
I wouldn't never conceived with the fact that I didn't travel a lot and everyone told me go travel. Go travel Six months, three months, whatever, go by yourself, enjoy. And I never did that. And I repent myself for not doing that. The sweetest moment I felt in my entire career was when Jeff Bezos is there. Jeff Bezos email saying I mean, he wasn't moving. That's not Jeff, but meaningless and ambitious explanations emailed to me opening up that email and saying, I'm seeing that yes, there was that moment that you see that you felt this is going to be something else.Yeah.
If I could be remembered for just one thing it would be
Matias Muchnick 30:36
I want to be remembered as a very humble general normal guy. humility, to me is very important.
Ash Faraj 30:44
And then the last one, I have to ask this, if I were stranded on an island and had access to one meal by meal would be
Matias Muchnick 30:50
honestly I'm going to kind of like put they're not co products so they're not in a burger with our prototype of not tetherties they're not peanut butter milkshake that is not milk and not ice cream.
Ash Faraj 31:05
Thank you so so much for listening to this episode. If you enjoyed this episode, please please leave us a quick liquid rating and review on Apple Pie can be a little bit limiting in a few seconds. Leave us a quick rating and review on Apple podcasts. It just takes a few seconds but it's worth so much to us. Thank you so much for listening. And like always, I always say this if you ever want to reach out to me my email is Ash at executive talks comm more than happy to chat and more than happy to have a conversation. We hope to see you again next week. Take care