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Week Daily podcast with Carol Masser and

Tim Stenbec on Bloomberg Radio.

>> Hi everyone, welcome to the Bloomberg

Business Week weekend podcast. Carol's

out this week. Alex Seanova and Emily

Grafo tapping in for some of our

conversations today. And it was a week

with the economic environment really top

of mind, especially top of mind. Global

markets reacting to a potential

resolution in hostilities in the Middle

East. Traders parsing mixed signals

about prospects for a US Iran deal to

end the war and revive energy flows

through the straight of hormuz. All the

important details of course can be found

at bloomberg.com and always on the

Bloomberg terminal. Meanwhile, lingering

interest rate anxieties, persistent

inflationary pressures, a deepening

global energy shock and more earnings

made us wonder about the state of the

consumer. Peter Atwater discusses how he

went from a K-shaped recovery to a

full-blown K-shaped American experience.

He'll explain in just a bit. With that

in mind, a closer look at two items that

are really squeezing American household

budgets, health care and food. We catch

up with the CEO of Resilient Health on

the personal cost of staying healthy.

And then with Dr. Michael Swanson on

what's keeping grocery prices stubbornly

high and speaking of the grocery aisle,

the founder of Mr. Bing Foods on scaling

a global street food into a profitable

condiment brand. And yes, we had to

taste the chili crisp. All that to come.

We begin with a look into consumer

health. The most recent US consumer

confidence report adding to evidence of

growing anxiety among American consumers

about the high cost of living. The

recent spike in fuel prices is

particularly challenging for lower inome

households despite a largely stable

labor market and few signs of broad

layoffs. When we talk about sentiment,

we talked to Peter Atwater. He's

president of financial insights. He's

also adjunct lecture of economics at the

College of William and Mary. He joins us

on set in the Bloomberg Business Week

studio. Peter, I think a lot of people

know you as the the K-shape guy. Uh, and

nowadays we hear about this from from

everyone, whether we're talking to

executives or executives are talking

about earnings calls um or we're talking

to to analysts or investors here on our

program. It's not getting any better. In

fact, it's getting worse.

>> Yeah. And in fact, it's no longer a

straight line K. the the arm of the K

looks almost parabolic

>> and the leg is turning almost straight

down into despair. And so the divide

between those at the top and bottom

isn't just economic at this point. It's

almost become two life experiences that

bear nothing in common. And I and I

worry that those at the top are doing

all they can not to see those at the

bottom, but in a world of social media,

those at the bottom can't help but see

this enormous overabundance

that exists above them.

>> I want to get more into that. There was

a great piece in the Atlantic this

weekend. The Vibe session is over. The

Perma session is here. It spoke about

how households are feeling worse about

their finances and the economy uh than

they did back in 1970 during great

inflation. So you talk also a lot about

the confidence gap. How much does the

pullback from lowerend consumers have to

do with the fact that they just don't

see any upward mobility?

>> It's not only that they don't see any

upward mobility. The AI boom has now put

a target on their back. They believe

that it's a zero- sum game and they're

looking at all of these gains being made

in AI stocks and believing that

ultimately it will come at their

expense. And so

a lot of this has to do with how both

groups imagine the future. And the

imagination of the future could not be

more divided in terms of extraordinary

optimism at the top and this dire level

of despair at the bottom. And it's the

despair that troubles me because I know

that ultimately

that is what sets people into the

streets. Are you seeing I want to talk

about those those people and the

repercussions of this or the

ramifications of this in a minute, but

before we do that just the we we hear so

much about the resilience of the

American consumer and I hear what you're

saying about despair and that bottom

rung of the K, but are we are we seeing

uh an uptick in people missing car

payments? Are we seeing people uh spend

a certain demographics, put a different

type of payment on their credit card? We

talked to the folks at the buy now pay

later firm a firm and they and they have

the you know their their client is the

average American and they say the

average American is doing so well right

now.

>> Yeah. So if I look at credit card uh

delinquencies, which this month look

like they're going to come in at about

13%.

What is so striking to me is if you if

you look at it mathematically

that level is historically high but it

comes at a time when within the card

portfolio you have enormous convenience

balances that are absolutely riskless

for the card issuer. And so on their

own, I suspect that the the quality that

the card issuers are seeing among their

lowest tier is distressful.

And the challenge right now, Tim, is

that we have this this bifurcation

where not only are businesses like the

airlines dependent on the top, but I see

so many derivatives of wealth, including

our banking system, that require at this

point those at the top to continue to do

extraordinarily well. It's fascinating

to me that a bank like JP Morgan

at the bottom of the financial crisis,

there were about $3 worth of credit card

balances to private banking balances.

Today, the lines have crossed. They have

more credit outstanding to private

clients than they do to Main Street

credit card holders. So there's been an

enormous wave of credit extended to

those at the top with a belief that that

they will never default. I think that

when you see so much of our economic

system now dependent on those at the

top, it begins to beg that question.

>> This bifurcation, Peter, has been a

problem for years now and seems to only

be getting worse as you just mentioned.

What can policymakers do to remedy this?

And if they don't step in, what is the

worst case scenario?

>> I I think policymakers need to be

thinking about the needs at the bottom

of the hierarchy. We know that food

insecurity

is an issue that leads people to protest

and riot. We know that basic health care

is financially debilitating to those at

the bottom. And so I think we need to be

thinking about the basic needs and

ensuring that there is a safety net. And

I think of it as a social safety net

that prevents despair from setting in.

And I think that we need to be cognizant

of the fact that there is a growing

population

that feel hopeless

and that hopelessness

ultimately leads to action. Well, what

what kind of action? I think a lot of

people watching this, especially on

primary day in in Texas and as we do get

into the midterms, would think that

there are electoral consequences and

certainly that was a lot of the naval

gazing that we saw post 2016 election.

But but what are ramifications of this?

>> So the ramifications, if you go back to

the fall, to me it was no coincidence

that in the midst of this affordability

crisis that everybody was talking about,

you saw a more populist mayor elected

here in New York.

>> Okay. who resonated both left and right.

One of the things that is so telling

about this latest consumer sentiment

data is that for the first time we have

a meaningful drop in confidence among

Republicans.

>> And so the bottom is purple. It's not

red or blue. And so that purple wants

change. And candidly, neither party has

done anything to suggest that they have

action in place to to serve those at the

bottom.

>> So, do do the do the people at the

bottom have to be served through

political action or is there a way for

this to be solved without Washington's

help?

>> I think you're you're seeing it on a

local level first.

>> Okay. as I would expect and ultimately

those changes on a local level lead to

national.

>> So local like New York City and Zaron

Mamani our newish mayor.

>> Yeah.

>> Where else?

>> So

I think we're going to see examples of

that this fall

where you have

incumbents on both the left and right

who are voted out. And I think it's

quite interesting in some of the

political ads,

incumbents aren't even talking about the

fact that they're incumbents like

because they know that it's

>> governor of California, someone like

Steve Hilton coming in or mayor of Los

Angeles, someone like Spencer Pratt

coming in for example.

>> Is that what you're talking about?

>> It'll start at a local level.

>> Okay. Interesting. And and part of that

is

every crisis is local and politics are

incredibly local when confidence is low.

And so that's where people it's

tangible. It's immediate. It's

proximate. And so those are where people

demand change first.

I'm really interested, Peter, in this

idea that you mentioned of America

becoming more of an ownership economy

where more and more goes to the people

who already own homes, who already own

financial assets. Can you talk a little

bit more about how this uh incredible

run in AI companies is worsening that?

>> Yeah. So you have beneficiaries of asset

inflation

and it's hard not to see it and it

driving everything from nicks tickets to

air airline seats.

Owners of assets today have choices and

opportunities that those below don't.

And I think that for every owner there

is a renter. there is, you know,

somebody with a car payment, somebody

with a credit card payment. So, so you

have those that are in essence extending

credit, extending opportunity and those

who are on the other side of it. And the

gap

to move from one to the other is

it's it's too wide and it's too costly.

You you look at you know the average

rate on a credit card you know 20ome

percent. Well to pay that off first to

to begin that upward migration is all

but impossible. We're speaking with

Peter Atwater president of financial

insights. He's a lecturer of economics

at William and Mary. He's also the

author of the confidence map charting a

path from chaos to clarity. Peter, let's

let's end with the investment thesis in

an an environment in a world where the

Ks are sort of going parabolic in the

other directions. We're speaking to you

on a day where the S&P 500 could finish

again at a new record. Doesn't seem like

this idea of a weakening bottom rung of

the Kay is holding back investment in AI

as Alex mentioned. What's the what are

the investment ramifications of society

like this? The investment ramifications

are that there is an overinvestment

in this abstract technology that we

crave when confidence is extremely high.

We imagine this

unlimited opportunity in futuristic

technology at every peak in confidence

and then there comes the backlash and in

this case I expect the backlash to AI to

only grow

>> and I think those at the top

particularly the proponents of AI

fail to appreciate the zero sum that is

seen seen by those at the bottom. And

the higher the market goes, the more

those at the bottom feel that ultimately

they will pay the price because to

sustain that earnings growth. It has to

come somewhere and the most obvious

target is labor. Peter Atwater always

thoughtful conversation when you join us

here on Bloomberg Business Week Daily.

Peter's president of financial insights.

He's an adjunct lecture of economics at

the College of William and Mary. He's

also the author of the book, The

Confidence Map: Charting a Path from

Chaos to Clarity.

>> You're listening to the Bloomberg

Business Week daily podcast. Catch us

live weekday afternoons from 2:00 to

5:00 Eastern.

>> Listen on Apple CarPlay and Android Auto

with the Bloomberg Business App or watch

us live on YouTube.

The surging cost of corporate healthcare

has employer sponsored premiums jumping

nearly 8%. It's the sharpest annual

increase in over a decade and it's

driven heavily by GLP-1 weight loss

drugs and outpatient care. That's

according to the 2026 Millan Medical

Index. That increase in cost now has

some companies moving past basic cost

shifting and partnering directly with

provider networks. It's something that

Dr. Donnes Nagda knows all too well.

He's the CEO and co-founder of Resilient

Health. that offers direct primary and

specialty care for employers and their

employees. Good to have you on the

program this afternoon, doctor. I um I

want you to explain how people access

resilient health because you you

essentially serve two different markets,

right? You need to get the employer to

sign on and you need to get the company

to start using the the the benefit and

then then their employees can start

using the benefit. How does it work? One

of the biggest things that we've seen

recently uh is that employers are really

struggling with their employees getting

access. I mean that's why you're seeing

the rise of these other tools because

people are just opting out of the

healthare system. And the problem with

that is that if you keep opting out of

the healthare system when you actually

get sick you don't know where to go. You

don't have an existing relationship. So

what the employers are doing is they're

offering these really high quality

benefits for their employees. And what

the data shows, and it's very well

established, but even our own internal

data shows that when you spend a dollar

on primary care, you can save $3 to5 in

the same year.

>> Wow.

>> What is the obstacle to the access to

health care? Is it is it financial? Is

it a a convenience thing? A difficulty?

>> I mean, we all have tried to get a

primary care appointment. It takes 3 to

6 months. So, there's no availability.

>> You literally have to know someone.

You have to know somebody and to have to

phone a friend just to get access to a

primary care doctor.

>> Yeah. Okay. I thought that was just a

New York City problem, but I guess it I

guess it's not.

>> But isn't that worse in other parts?

>> But that's a problem. St. Louis, it

takes six months.

>> But isn't that a problem with primary

care because uh primary care doesn't

really do procedures and therefore

they're not paid the way that other

doctors are paid. So there's a problem

attracting primary care doctors or in

the case of like so many doctors who

I've had even even our pediatrician

they're going concierge. So literally

tens of thousands of dollars to to

actually go and see a doctor because it

is so much more lucrative and there is

that opportunity there. How do you

attract primary care doctors

>> with when the when the system I think

many people would argue is so broken?

Well, the dirty little secret in

healthcare is that everybody's focused

on the boomers, the aging population,

Medicare Advantage, and what's happened

is when you think about Nana having

seven different diseases, the primary

care doctors have to spend an hour, two

hours with her, but they can't worry

about your mental health, they can't

worry about your other issues, and so

they end up spending 5 minutes with you.

And so that delay is coming from the

fact that we have a mismatch. We have a

primary care doctor that's coming in and

is completely focused. The first visit

was somebody with cancer, the second

visit with somebody with maybe what

seems like nothing, back pain, but that

back pain can lead to a 40 $50,000

surgery. So this mismatch of supply and

demand is a big issue. And that's where

AI is actually playing a great role.

>> So you you trained you you went to med

school at the University of

Pennsylvania. You you did your residency

in odolarangology at the um at at WashU

in St. Louis. What made you want to sort

of leave traditional

uh medicine and start companies?

>> It's actually one of the greatest there

was recently lots of data that came out

in the last week or so. A lot of doctors

are leaving medicine making the problem

worse. Now I might be part of the

problem but I want to be part of the

solution as well which is it is

incredibly challenging right now for a

provider or a doctor to deliver care. Uh

the reimbursement models are completely

breaking. The patients are not getting

enough time. there's moral injury

associated with it. And so what we want

to do is use technology to restore that

doctor patient relationship and that's

really what I built this company around.

I mean I'd already built a company

before that was acquired and went public

and so this was for me the opportunity

to kind of go back and build this and

most importantly I was a caregiver for

my dad and this is the the again uh

unspoken truth in healthcare in America

because we're so focused on people with

chronic diseases. you, your family

members, and others are walking around

with undetected diseases that will

become those chronic diseases. And if we

could get early early enough into the

cycle of it, we could prevent what

happened to my dad and my co-founder's

mom where they literally just missed a

diagnosis for decades from happening and

my dad would still be here playing with

my grand, you know, with playing with my

kids. And so I think that that's the

reality of healthcare in America. H

>> how does AI find those? Is it AI? How do

we find those undetected um symptoms? AI

is already finding them today. 40

million

daily queries on chat GPT for

healthcare. 40 million daily. You that's

way more than the healthare system today

because people are just saying we're

done. We're opting out. We're going to

go this other route because we trust

them more than we trust doctors. And

it's just the way it is. As a doctor, I

feel very comfortable saying that. The

problem is one, those systems are not

built with the clinical guardrails that

are required. two, when you do need

something, they don't know where to send

you. And so I think the answer is AI

plus healthcare together solving the

problem. So you could go into, for

example, resilience AI native. So you

can go in and ask us questions just like

you would with chat GPT, but we can

escalate it to a provider. They can see

you same day. So, it's just the

opportunity to be able to get as much

information, as much time, and most

importantly, as much knowledge that is

needed for you to take care of yourself,

but not get lost in the rigor role of

the current healthare system, which is

just an absolute mess.

>> Yeah, I actually threw some labs into uh

Claude a little earlier today.

>> And I'm and I know my doctor will look

at him and get back to me, but now I

know what he's going to say. So, I guess

if if Claude is correct, that's the

question. Hey, the the ma making sure

that that the AI is actually trained

because we did site a study earlier this

week that said a good portion of what

you get back on chat GPT when it comes

to medicine is not actually that

accurate. What's the right way what's

the right way to have the guardrails up

that that actually make sure you deliver

the right information? Just 30 seconds

left.

>> Yeah. So, from our perspective, the most

important thing is to know when uh the

confidence of that model is high or low.

So, if you just think about the way

cloud responds to you, it's as if it

knows all the answers. um and that

everything it's saying is correct. For

us, we actually look at confidence

scores of the responses and use that to

escalate care in a what we call harness

of guard rails to make sure that no

patient gets the wrong care at the wrong

time.

>> Dr. Danish Nagda got to come back soon.

Appreciate you taking the time and and

and joining us. He's the CEO and the

co-founder of Resilient Health. He joins

us this afternoon. From paying up for

healthare to paying up for groceries.

Here's an interesting story that you

could have missed. We know farmers

worldwide have been under pressure due

to the Iran war. It's disrupted supplies

of conventional nitrogen fertilizer.

It's forcing these farmers to improvise

ahead of this crucial fall planting

seasons. One of the ways they're

improvising is actually using human

urine as a fertilizer. TP Organics is a

French startup. This was in Bloomberg

News last week. It converts human urine

collected from schools and festivals

into a bacteria feed that helps plants

grow. The Bloomberg newspiece also said

that since late February, sales have

jumped about a quarter for the product.

There is no end in sight to rival US and

Iranian blockades in Hormuz. Fertilizer

disruptions are expected to persist. A

prolonged conflict could mean weaker

harvests and higher grocery prices. This

is what Dr. Michael Swanson looks at.

This is his specialty. He's chief

agricultural economist at the Wells

Fargo Agra Food Institute. He joins us

from Maryland. Dr. Swanson, good to have

you on the program. the disruptions that

we've seen as a result of the f of the

on fertilizer as a result of the the war

in Iran, the straight of hormuse

closure. We spoke at the top of our

program about what an open straight of

hormuse could look like and and when

that could happen. Hint, we're still no

closer than we were 3 days ago is what

our our Bloomberg news team says. Uh

Chris Kennedy over at Bloomberg

Economics. uh if the straight were to

open how quick soon how quickly would we

then see fertilizer prices drop and that

actually hit worldwide agriculture.

>> You know it's interesting the prices

would drop quickly even though the

supply itself would be delayed behind it

but these are markets that are always

looking forward. So he the same thing

that drove them up quicker than the

product disruption would take the prices

down faster than the product actually

arriving to the markets.

>> Dr. Swanson, one of the themes that

we've been talking about a lot is this

idea that consumers are trading down on

certain items. They're trading down on

staples but splurging, for example, on

certain categories. Where are you seeing

this when it comes to food trends?

>> You know, it's interesting. You can see

it clearly in the protein space. I mean,

when you look at the value of chicken

and pork relative to beef right now,

clearly it's really bidding up that

demand in a big way. But on the flip

side, when you look in the beverage

categories, some of the probiotic um

soft drink replacements, they are super

premium pricing, but they're not finding

any problems looking for good demand.

They have plenty of product demand even

at that super premium pricing.

>> You know what I noticed over the

weekend? I was buying some chicken and

it said 20 grams of protein per serving

on it. And I'm thinking to myself, is

this is this a result of the protein

craze coming from GLP1s that, you know,

even even foods that have had the same

protein content in them for generations,

like forever, are now advertising that

protein because that's what at least

American consumers want to see.

>> That's exactly what you're seeing. So,

we're seeing across every single

category. If you have a protein

component, you're going to highlight

that first on your packaging. And it's

interesting how packaging really

responds to that question that's on the

consumer's mind. But you're exactly

right. This is something that's going to

continue and it's going to be very

prominent. I think you're going to see

it clearly in every single category.

>> Is this protein craze is it like other

food crazes in the past where we've

we've seen people, you know, consumers

are fickle and and Americans are fickle

when it comes to sort of what we follow

or is this protein craze here to stay?

>> You know, it's a great question and it's

here to stay. I mean, you you and I can

all name diets that have come and go.

paleo, Atkins, and things like that. But

when you're talking about a medicine

that's going to be prescribed, it's

going to be the new statin. When you

think about it, there's like 90 million

prescriptions for statins out there

right now. This is going to be the new

statins. And since Americans are pretty

good at taking their pills, this is

going to be one that's going to stick

around. This is not a fad that's going

to walk away. It's going to be here for

a long time. Consumers are very much

feeling the sticker shock of prices when

they go to the grocery store even as

some agricultural commodity prices have

actually come down. At what point do

consumers feel some of that relief in

the stores?

>> You know, it depends on the category.

Take eggs for example. Last year's um

aven highly pathogenic aven influenza

was just an enormous shock, but we're

actually below the price starting that

cycle right now. But we're not seeing

consumers really take away a lot more

eggs even at these really low prices. So

it takes an awful lot to shake an

American out of his particular diet that

they really like. But we will see some

relief as we, for example, the dairy

industry right now, they're chasing more

cows to produce more beef, which means

more milk. So we're seeing good dairy

pricing as well. So the consumer does

have some opportunities if they're

willing to look for them. As we head

into the summer months, are there any

categories in food that might see

inflation pick up? Any that you're

expecting for it to be worse than

others?

>> You know, right now what we're seeing is

a little bit in the vegetable and fruit

category. We started out the year with a

tough spot with the freeze in Florida

which really put up the price of

tomatoes and we're going to have to wait

to see what happens with the labor with

the transportation cost because diesel

is a major cost for moving it around the

country and bring it into the country.

So probably fruits and vegetables will

probably be the most pressure thanks to

the um recent events we've seen.

>> So my same question to you about

fertilizer has to do with diesel prices.

If the straight does open and diesel

prices come down, will will we stop

seeing those price increases in fruits

and vegetables?

>> You know, probably not because the

bigger driver is going to be that

long-term availability of wages and wage

inflation is probably still running in

that 3 4% range right now. So diesel

would be a nice relief factor. Don't get

me wrong on that, but the wages are

going to be a bigger piece of it for the

longer term. And once they go up, they

almost never come down.

>> What about our farmers, Michael? There

is a disconnect between how much farmers

are earning and how much consumers are

paying. Are American farmers getting

squeezed right now as grocery bills

remain elevated?

>> You know, it's a great question. It

really is farmer by farmer. You know

when we look at the micro data that we

have last year we saw some amazingly

good returns in the same year as very

bad returns and I think what really

driving a lot of it is the technology

what we're hearing from the farmers is

technological change is so rapid and so

difficult they're having a hard time

implementing it if they're not on top of

it. So yeah, we're seeing some squeeze.

It would be nice for them to get some

price relief from the higher crop prices

which would be inflationary or lower

input prices which would be great. But

what's not going away is the vice of

technological change which is just

really putting them in a tough spot.

>> You mentioned the rising prices of

protein and the story in the Washington

Post over the weekend got my attention

about how the Texas barbecue industry is

struggling due to rising meat prices.

The cost of brisket increasing 28% over

the past year. Imports coming from

outside the United States. I mean that

that is what an import is. Is that going

to put a dent in in rising beef prices?

you know, not really for that type of a

category. So, grind that goes into

hamburger. Absolutely. This industry has

discovered that Brazil is a gold mine of

hamburger and they're going to mine it

for the foreseeable future. But when it

comes to identifiable cuts, steaks and

and brisket, things like that, no, we

don't really have another source because

we want a certain quality. So, this

industry is pretty bullish right now

about their ability to keep prices high

and it usually is a sign that things

will change when they think nothing will

change.

>> Michael going to have to leave it there,

but this was a great chat. You got to

come back soon. We appreciate you taking

the time. Michael Swanson, chief

agriculture economist at the Wells Fargo

Agra Food Institute joining us from

Minneapolis this afternoon.

You're listening to the Bloomberg

Business Week daily podcast. Catch us

live weekday afternoons from 2:00 to

5:00 Eastern.

>> Listen on Apple CarPlay and Android Auto

with the Bloomberg Business App or watch

us live on YouTube.

Sometimes we get the stuff ahead of time

to try it and just like see or just like

check out the product.

>> Scarlet food.

>> Yeah, she gave me she gave me some of

the the chili crisp.

>> I didn't get anything on his desk.

>> It was on my desk and it it said you

don't need to refrigerate it. You can

just open it and and then so every day I

just take a little bit and put it on my

eggs. Poof.

>> Yeah. And then suddenly I ate both of

them. But fortunately Brian Goldberg

brought more. He's founder and chief

chief growth officer over at Mr. Bing

Foods. He joins us here in the Bloomberg

Interactive Broker Studio. I'm glad you

brought I'm very relieved you brought

more because I was really worried that I

had um you know really messed this up.

Uh you have a really interesting story.

You had this food truck. You you spent

some time living abroad where you had

this love of street food. You wanted to

bring this back to the to the US. How

did you end up with a project line that

looked like this?

>> So it all Yeah. It started back in the

late '9s in China. Study abroad with my

co-founder in Beijing. Ate these amazing

street foods in particular yenbing. It's

like a savory Chinese crepe that we

would have for like breakfast every day

before school and then one day we

decided to bring that you know to Hong

Kong and then to the US and the sauces

in there is what our platform is now. So

we had a whole restaurant kiosk food

truck life in Hong Kong and then in New

York for almost 10 years where the brand

really built itself up uh as a street

food forward panasian street food brand.

The sauce is basically we were doing

popups inside a lot of the corporate

office cafeterias in New York pre-

pandemic partnering with Compass Armark

and Sedexo and the chefs noticed that we

had this chili crisp that we had

created. Uh chili crisp has existed for

a long time right in China. Basically we

wanted to make a version a little more

accessible for the American market on

our own the right particulate size to

spread in the food a mild version of it.

little bit of a different flavor

profile, a little more versatile with

Mexican, Korean, Chinese flavors to make

Chili Crisp more adaptable to so many

other cuisines.

>> The chefs at those places like at

Goldman Sachs and at Morgan Stanley and

at Google, LinkedIn, where we were doing

all these uh Bing popups, loved it, and

asked us to put it in a big size that

they could use in other foods.

>> So, I'm holding a there's a there's a

big size here. This is I don't think

they have the actual Oh, 64 ouncez.

Yeah. version of this which

>> that is a big size

>> which a typical is 7 oz. So yeah that's

that's a big that's

>> so for their for their use in their

kitchens. Yes, they wanted to use it

like to mix with ranch, to mix with

mayo, to make what they call plus ones

or sauce hacks where you I mean you can

use it straight up like on eggs, rice,

pizza, pasta, burgers. It was a big

trend. I mean, it trended a lot during

the pandemic, right? It's become much

more mainstream now when it was much

more niche before.

>> Well, it's it's interesting because I

see it everywhere now. Just Chili Crisp,

a lot of different companies make it.

And it was it was first on my radar like

I guess maybe two years ago. My wife

bought it at the store, brought it home

and now it's like now it chili crisp is

a condiment that we always have

>> in the home and we have bought there are

a lot of different versions of it. I

mean Momaf Fuku does a version. There's

like some classic versions

>> uh as well from from other companies.

It's really crowded space at this point.

>> Well, Chili Crisp definitely saw like a

massive growth during uh the pandemic.

It's grown over 700% on menus nationwide

in terms of the mention of Chili Crisp,

right?

>> Which is sort of our real strong forte

is on the food service side as well.

We're one of basically the leading brand

in the country in food service chili

crisp.

>> If you go to a restaurant, hotel,

college, stadium, airline, if they're

using Chili Crisp, they're using your

stuff.

>> That's so interesting.

>> Most likely it's ours. Not necessarily.

>> Is that like is that like 70 or 80% of

your business or what's

>> Chili Crisp? Chili Crisp itself is about

85% but within our overall business

almost 50% of our of our revenues is

food service.

>> Okay.

>> Right. So that so our products are very

chef driven. I mean like it was kind of

created by the rest by the kiosks.

Right. And then the chefs that started

buying it in big size wanted it a

certain way. And we really had that

dialogue with a lot of chefs about

creating it, how to create it. And then

that's what led to the barbecue sauces,

a more squeezable sort of format of a

chili crisp, right? Um, so we've been

very involved with the chef community

around the country. We've been very

fortunate uh to have that opportunity

and that's there's a flywheel effect

between

>> being on restaurant menus and then how

your sales are like in the stores ret

and also the e-commerce piece like all

three of these things you know impact

each other.

>> Where's the growth? I get the under I

get it like you're in a restaurant you

do it and then you like you want it for

home. Where's the growth in terms of

your businesses? Is it to the

restaurants or the business side of it?

Um the corporate side if you will or is

it in retail outlets? Like where's the

where's the growth?

>> The it's all really across the board.

All of it. You know, I think we've been

very fortunate to have the opportunity,

the relationships and the distribution.

Frankly, getting distribution is really

hard. You really need like anchor

customers, anchor clients, anchor

restaurant chains, anchor retail. Once

you have that, then you can really go

out and sell to everyone everyone else.

Uh, but the growth right now is in our

squeezables. Like chili crisp is

awesome. Don't get me wrong. People love

it, but you got to you got to stir it

up, spoon it out, scoop it out. It's a

little bit. You have to take that extra

step. You get a little oil on the on the

counter, which is fine. It's just the

nature of it, right? Because of the

texture and how the particulates are.

But a lot of people just like to reach

for something and squeeze it and squirt

it and put it back, right? And that's

what these are. This takes chili crisp.

They're about 10% chili crisp bits in

them. So, it's a line of Asian barbecue

sauces. Chili crisp barbecue sauces. the

first ones on the market that are a

chili crisp based barbecue sauce, right?

Uh and that was developed because chefs

wanted to squeeze the chili crisp. They

wanted to be able to apply it to pizza

or to wings more easily. You needed

something sticky like a binder, right?

And that like toppers pizza in Wisconsin

was the first one that really did that

with us. And that led to the OG sweet

and spicy. And then that worked so well

in a large format that we decided to go

a little more panasian. And that led to

the Thai the hot the Thai hot honey

which has more like lemongrass and could

fear lime leaf in it. We have a Korean

go jang forward one that has more yuzu

and ginger. And we have a mild. So don't

forget like our mild chili crisp is

actually more than half our sales of

chili crisp because almost half of

Americans don't like spicy food.

>> I'm a mild kind of gal. The rest of my

family is

>> Okay. So I'll take the spicy one. You

take the mild. Um the the the things you

just held up those small dishes. What

are those? These are samples. These are

just we call them hockey pucks.

>> Basically, these little baby guys.

>> TSA compliant.

>> They are TSA compliant. They are. And

I'm sort of infamous for always having

them in.

>> So now I know what he's going to be

traveling with.

>> Yes. Exactly. So b basically I mean food

service is so relationship driven and

chili Chris to your point like a lot of

people don't know what it is. You have

to taste it to kind of understand what

it really is if you've never had it.

>> I've never had it.

>> Oh it's it's so good. sharing with you

when I was

absolutely not.

>> But honestly, I have a I have a real

question about the serving sizes because

the these these little jars have 40 are

supposed to have 40 servings.

>> Um that is like not typical for me uh in

terms of serving and but also

to to include on.

>> How much do you take, Tim? How much?

>> A few teaspoons each time. Yeah, quite a

bit though. But I but but I mean I think

that's it's kind of regardless. I don't

know. It just SEEMS LIKE

>> I'M SORRY. IT JUST SEEMS like a small

serving size. I don't know. Do you do

you find that chef

>> you know you have a big appetite?

>> I do, but but do you find that chefs are

actually adhering to like what a like

that actual suggested serving? I know

that's just the nutrition information

side of it, but is that meant to be like

to flavor an entire piece of pizza or

flavor like three eggs?

>> It's it's a good question. So like in

food service and according to like food

labeling rules, there is a standard

serving size for different types of

things. Barbecue sauce is a particular

standard serving size.

>> I guess that makes sense if you want to

compare labels across the board.

>> Yes, exactly. And chili oil because it's

pretty potent or can be pretty potent.

You know, ours is not. We It's kind of

builds up. It doesn't overpower you.

It's more about the texture, the flavor,

but there is a standard serving size

that you put on there for chili oil.

Now, chefs will use as much as they

want. Okay.

>> Right. I mean, the Tyson chef was

covering an entire turkey with a chili

crisp turkey as a new concept.

>> That's cool,

>> right? That's really cool.

>> And so that totally blew away the

portion size, right? So

>> Tim, did you hear Brian said standard

size?

>> Yeah, standard. Yeah, that's okay.

>> Just got to put out there. Um I'm just

looking at So you guys are in 10,000

retail doors nationwide.

>> Yes. Over 10,000 on the Chili Crisp.

Over 200 on the barbecue sauces. Yeah.

And I don't know how many thousands of

restaurants, hotels, colleges, stadiums.

Does it sell in terms of the retail

across the country equally or do you

find there's certain metro areas where

you really that's where a lot of the

demand is?

>> It I mean it does tend it used to be

very strong in the more international

coastal cities right uh but it's really

spread just cuz you know Tik Tok and

social media people see these things all

over the place right away it doesn't

really matter but yes we have had a

stronger a little bit higher numbers I

guess you know east coast and west coast

Pacific Northwest where we manufacture

it California obviously large Asian

manufactured in the United States or

>> it is we make everything in the United

States which has been really great

especially to avoid you know we haven't

had the really tariff issue come up uh

it makes it a lot easier for us to work

with our manufacturers uh to adjust

things in terms of supply chain uh but

yeah it is we put made in USA and pretty

>> pretty big letters on there you know so

Asian inspired but made in the USA

>> you know um McCormack bought Cholula

>> hot sauce for $800 million back in in

2020 things have changed a lot in those

in the last six years. You're an

independent company now. What's the plan

for acquisition or the future?

>> So, we we're very focused on our current

products, growing them, getting them

more into more chefs, more stores. We do

work with some other big brands. We've

been very fortunate through the food

service industry in particular, right?

>> With Kikman, for example, we do a Chili

Cres poison sauce together, which is

awesome. little bit of panzoo, a little

Sriracha in there and we sell that in

food service together. Uh with Hormeell,

we work with them with their proteins

like really complimentary uh companies

where they'll use it to ideulate with

big the biggest restaurant chains in the

in the country right on how to integrate

our sauces with their products. And you

know, we'll see where things go, but

right now right it's really focusing on

growing the products, getting the new

products out.

>> So there's more expansion that can come

off of this.

>> Absolutely. a lot a lot more

>> like what?

>> Well, there's, you know, when you talk

about numbers in retail, there's roughly

30,000 supermarkets in the country that

you kind of judge in terms of your

percentage of penetration in retail.

>> Yeah.

>> We're just over 10,000, right? So, we

have definitely a ways to go and in food

service as well and especially with the

with the new products. So,

>> you know, we're at about a 12 million

run rate right now. We're profitable and

there's um a lot more growth to

>> So, so Brian, how much should Tim eat of

this regularly? I think that's personal

preference.

>> Like one teaspoon is a normal a normal

person.

>> Big chili crisp guy.

>> One teaspoon.

>> That's a suggestion.

>> And should he share with his colleagues?

Maybe

>> he should. Come on.

>> Yeah,

>> I will share.

>> It's on the record. Everybody,

>> Brian Brian Goldberg, founder and chief

growth officer over at Mr. Bing Foods,

joining us here in the Bloomberg

Interactive Brokers Studio.

This is the Bloomberg BusinessWeek Daily

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