When your early-stage startup loses a customer: How one producer is handling the Good Eggs shut down

One of the first and best pieces of advice Salty Girl Seafood received as a young startup was to work with other startup companies. This expands your network, allows you to keep a finger on the pulse of startup culture, and learn first-hand from other early-stage companies.

When Good Eggs reached out to us to be their supplier of sustainable seafood on their platform, we leapt at the chance. Good Eggs was a well funded and fast growing startup with a mission and company culture that aligned well with our own. Selling through their platform turned out to be an incredibly timely opportunity for our young company.

In true startup style, we were gearing up to pivot, and Good Eggs provided us the launchpad for our new product line. Through their platform, we were able to validate product-market fit, refine the product and features, and obtain customer feedback -- something that for many food companies requires endless hours at farmer’s markets and focus groups.

Good Eggs afforded us the luxury of getting our product in front of our target customer with minimal risk and low overhead. The data and validation that we gleaned through our sales provided us the necessary support for our company’s pivot and has fueled a successful transition. Without the opportunity to host our product on Good Eggs, who knows how much time and money we would have lost trying to achieve the same degree of validation.

While we have taken the advice of working with other startups to heart, working with other early-stage companies can be risky. In a sense, choosing to work with startups means evaluating the strength of their model and team, and determining whether or not the reward outweighs the risk. Ultimately, we are making an investment. In this case, Good Eggs seemed infallible. They had scaled, operating out of several locations (hubs) following city-by-city rollouts. Unfortunately, as CEO Rob Spiro mentioned in his letter to vendors, they made the egregious error that every investor dreads: they scaled it before they nailed it.  

The news of Good Eggs decision to close three of their four hubs, including LA where our product was offered, came as a surprise to us. The shock was surely felt to varying degrees by the hundreds of small businesses and food producers across the US who rely on Good Eggs for a portion of their sales.

This is the risk we knowingly take as startups, working together.

For my team and me, Good Eggs provided a unique opportunity to obtain the key data to launch a new product, grow our brand and inform our strategy. I can only imagine there are countless other businesses and producers who have had a similar experience. Through this process, we have learned valuable knowledge that we hope to pass on to other young companies considering a similar risk.

  1. Don't put your eggs all in one basket (pun intended!). Diversify your sales through several small companies to start. It will hurt less if you lose a customer.
  2. Don't panic. Startup life is all about change and risk. Be prepared for it and react accordingly.
  3. Get out there and sell. Use it as an opportunity to find new customers. You proved you could sell through a small company. Now take your sales to the next level with a more established retailer.

Taking the lessons learned from Good Eggs, we are now prepared to launch our product line in retailers across Southern California. We will continue to grow (our Good Eggs customers are already reaching out and asking where to find us), and look forward to working with the next startup or retailer with whom we can accelerate.

Photo credit: Good Eggs // Alicia Cho

Photo credit: Good Eggs // Alicia Cho

About Salty Girl Seafood

Salty Girl Seafood, Inc. is a sustainable seafood company founded in 2014 and headquartered in Santa Barbara, California that develops sustainable, traceable, chef-quality seafood products that incentivize sustainable fishing practices and promote stewardship of our oceans. The team has a strong background in fisheries management complemented by extensive startup experience, and is a member of the 1% for the Planet network, donating 1% of annual revenue in support of an ocean-related non-profit. For more information on Salty Girl Seafood products and stores, please visit the Salty Girl Seafood website or follow us on Facebook and Instagram.