From humble beginnings working in fast food to DJ-ing a morning show, from selling his grandfather’s pasta sauce to now running Craft Cannery, a small-scale food manufacturing company. Pauly Guglielmo’s journey offers key lessons for food entrepreneurs looking to scale their businesses.
In this episode of Spilled Salt, Pauly shared the highs and lows of his entrepreneurial adventure with host Maureen Ballatori, offering insight into how small food startups can succeed in the competitive CPG landscape.
The Birth of Guglielmo Sauce and Craft Cannery
Pauly Guglielmo’s journey began in 2013 when he turned his family’s pasta sauce recipe into a side hustle. With a passion for food and an unyielding entrepreneurial spirit, Pauly spent years selling his sauce at farmers markets and festivals while cold-calling local stores, wineries, and supermarkets to get his products on shelves.
But Pauly didn’t stop at selling pasta sauce. In 2020, he made a bold leap into contract manufacturing, buying Craft Cannery. His vision was simple: help other food startups turn their recipes into retail-ready products.
He saw a gap in the marketplace. Many small businesses struggle to find affordable, small-scale manufacturing solutions, but Craft Cannery could provide an accessible option, making it possible for food entrepreneurs to commercialize their products without massive upfront investments.
Solving a Major Problem in Regional Food Manufacturing
Small food brands often face significant hurdles when trying to scale production. Most co-packers require large production runs, making it impossible for small startups to afford. Craft Cannery, however, fills that gap by offering small to medium-sized batches, enabling entrepreneurs to launch their products without breaking the bank.
Pauly’s transition from Guglielmo Sauce to taking over Craft Cannery highlights the importance of finding a niche in the market and offering a solution that benefits others. His ability to identify a problem that needs solving and building a business around providing that solution also helped him win the Grow-NY pitch competition in 2022.
Staying Focused and Figureoutable Entrepreneurial Challenges
Yet, entrepreneurship is never a smooth road. Despite his success, Pauly battles feelings of self-doubt and relies on trusted partners to keep him focused.
One of the most challenging moments Pauly faced was managing cash flow during the early days of Craft Cannery. Like many startups, he initially struggled with balancing expenses and revenue.
However, instead of giving up, Pauly took decisive action.While the situation felt dire, it was figureoutable. By adjusting payment terms with suppliers and clients he improved cash flow within weeks.
Curiosity and Scaling a Growing Business for Success
One of the most obvious things Maureen learned in conversation with Pauly: he’s always curious, always growing. Since purchasing Craft Cannery, he has updated equipment to increase capacity. He’s also purchased a neighborhood grocery, providing shelfspace for his products and those Craft Cannery manufactures.
From launching a pasta sauce brand to becoming a manufacturer, Pauly’s story illustrates the importance of perseverance, solving real industry problems, and staying open to opportunities.
Transcript
This transcript has been edited from its original form to support readability.
Maureen Ballatori: I’m Maureen Ballatori and this is Spilled Salt, a podcast on the thrills and spills from the food, beverage, and agriculture industries. Today’s guest is Paul Guglielmo. He is the CEO of Craft Cannery and the owner of Guglielmo Sauce.
I was reading his website in preparation for today’s episode, and he said part of being Italian is absolutely loving to cook for other people. And so one, I can tell you, I married an Italian and based on my experience, that is absolutely true.
And it also just says a lot about Paul. Not only has he taken his Grandpa Pete’s sauce recipe and turned it into, if you’re in Greater Rochester, it’s a household brand, but further beyond that as well. His cell phone number is literally on every jar of Guglielmo Sauce.
And he is now also helping other people bring their dreams of bringing their sauces or other consumer packaged goods to market through Craft Cannery.
Lovely conversation with Paul today. He also talks about his experience in the Grow-NY competition. He was one of the winners in 2022. He talks about how he has gone through his career pursuits to take on new enterprises and in ownership of Craft Cannery and others and also bringing on partners and one of my new favorite parts of discussions with guests on the show to a high point and a low point from his career.
Enjoy the conversation.
Maureen: Hey, Pauly. How are you?
Pauly Guglielmo: Hey Maureen. My God, I’m just honored to be here. I can’t even believe it. Look at that face. That’s the face of Maureen Ballatori. I can’t believe we’re going to podcast together. This is exciting. Thank you for having me.
Maureen: You’re too kind. I’m so excited to have you here. You’ve got a remarkable story and I look forward to sharing it with today’s listeners.
So we’re going to do what I always love to do, which is take it all the way back to the beginning. So tell everybody what baby Pauly’s childhood hopes and dreams were your first job leading up to the work that you’re doing now.
Pauly: I grew up in Northeast Ohio. The first time I ever passionately wanted to be anything was when my parents took me to see Jurassic Park in the movie theater. I decided I wanted to be a Hollywood actor that day.
I think I was 12, so I understood the idea of acting, but also I was so into that movie that I just wanted to be on the set acting like I’m afraid of the Tyrannosaurus Rex. And I vowed that day that I would be a Hollywood actor one day. And I’ll tell you what, Maureen, I’m not dead yet, so we’ll see.
First job was at McDonald’s, unless you count working in my grandpa’s that you know raking yards or like digging the trenches or edging the sidewalk but my first real job was McDonald’s. When I was 16 I got a job working for five dollars and 25 cents an hour at Mickey D’s and I worked there through high school.
Then I also was an exchange student in high school to Italy so I worked and saved up money.
Actually a fun fact about me, since you want to start so early, is that for a short period of time, I dropped out of high school. Yes, it’s kind of a loophole. I didn’t really, but I had to formally withdraw to become an exchange student. And I didn’t leave for Italy until mid September. And so when all my friends in Ohio, we go back to school early, like mid August. So I had to formally withdraw, AKA dropout of high school. And then I worked at McDonald’s to earn as much money as I could before I left for Italy.
Maureen: Did you really?
Pauly: So for about four weeks in 1999, late summer, my friends were in school and I was working at McDonald’s every day as an official high school dropout. Sixteen.
Maureen: Wow. I think it takes a lot… Speak to – who was Paul at that time, because I think also, you probably did not identify as the high school dropout you because it also takes a lot to want to go overseas to be an exchange student in another country at that age.
Maureen: Yeah, and I will say too, I was a true exchange student, meaning a full year. And you hear a lot about studying abroad, which is phenomenal.
Studying abroad is phenomenal, but it’s a semester and you typically go with other American students. I went alone for a full year, which is different. An exchange student is different from studying abroad.
I lacked confidence. I wanted to find something. I wanted to be somebody. I felt like I was nobody. Nothing made me different. The only thing that I really could find that I thought was cool was Sunday’s at grandpa’s house and the idea of going to Italy for a year would bring me even closer to that.
I was just desperately trying to find something I could be good at. And being the kid who went to Italy was like the closest I could come with that I found something I was willing to do that all the cool kids, smart kids, athletic kids were not willing to do, which was just leave for a year, come back tanned, bilingual, you know, ready.
Maureen: Very brave.
Pauly: It was, honestly it did. I look at 41 right now. If you sent me to Italy for a year, I don’t think I could do it. I don’t have the guts to do it now and I did when I was a teenager.
Maureen: I’d love to have another episode about your experience in Italy. We’ll have that on another show.
So, continue me through the career so after McDonald’s after your exchange program. You came back to the states and then what happened?
Pauly: I came back and like I said, I’m desperately trying to find something that I’m good at. So I come back, what am I going to, I’m going to go to college. What am I going to study? The best I could come up with was international business.
The only thing I could think of that I wanted to do, the only skill I had. I was very aware of the fact that I was going to need a skill at some point that made me good at something. And the only skill I had at that point was I did come back bilingual.
I thought I could go to Italy and maybe work at a hotel or something. And if I could work at a hotel or something, I could be the English speaker. I could be the translator.
Some Italian businesses must do business with America and need an American on their side to speak that language. so the idea was just what was I good at? That was it. Unfortunately, I was not smart enough for business class because you had to pass accounting and I couldn’t do that. Dropped it twice, two semesters in a row.
But I did stumble upon the local radio station, the college radio station. And I dove into that completely head over heels, fell in love with radio, and won an award for best production. And that’s all I needed, Maureen. As soon as someone gave me an award and said, you’re good at that, I said, okay, I’m all in. I’ll do this then. Radio.
Maureen: What did you love about radio?
Pauly: The initial thing that I loved was that College Radio is full of emo indie garage punk music and I was really into hip hop music. And so I loved editing out curse words of rap songs and I got really good at it.
And because I got really good at it, I acquired a skill which was that I was good at editing audio and I could make commercials. And so as soon as someone learned that I was good at that, I became very marketable at the College Radio station and then later I got hired at a real radio station
There I could be on the radio, because that’s what everyone wanted, but because I had the skill that I could make commercials. I could actually record and edit audio. And that got me a job. Then I just dove into that head first and was just madly in love with that business.
Maureen: And you were on the radio for a long time, right?
Pauly: Yeah, I did 15 years.
Maureen: And so what was the straw that broke the camel’s back that made you say, maybe I want to make a shift from this?
Pauly: Well, so I did start the business – just Guglielmo Sauce, not Craft Cannery, but the actual Guglielmo Sauce. I started while I was still there and it was on the side, started as a side hustle.
Well, it started as a hobby, turned into a side hustle, turned into an actual part-time job and eventually turned into a full-time job between 2013 and 2020.
While that was rising, radio was falling, frankly, and I was not super thrilled anymore to be doing what I was doing in radio.
I started to get burned out. Radio in general was not necessarily a business that was just looking like it had this really bright future. I didn’t feel looked out for by my management, frankly, which is like you said, a whole other podcast.
I started to lose faith in my leadership, frankly. All of those things combined, plus the fact that I had these two things. I had radio and I had sauce and I knew that at one point one of them would boil over and I’d need to give attention to that.
What I didn’t expect was for the boiling over to happen on the sauce side and for the other pot to just completely stop boiling, period. Both happened at the same time.
Maureen: So you said that from 2013 to 2020, Guglielmo Sauce turned into a full-time job. What made that happen? What made it a full -time job? What were you doing?
Pauly: So at the very beginning, it was signing up for all the farmers markets, all the arts festivals, music, food festivals. Anywhere I could go pop up a 10 by 10 tent and hot sauce was what it really started as.
And then during the weekdays, the one advantage working in radio is I was done at noon every day because I went to work at three o ‘clock in the morning. So I was a morning shift guy. So I would drive around all afternoon just cold calling, trying to get my sauce into stores, wineries, big supermarkets, from local delis to supermarkets to wineries, et cetera.
After I built that for a year or two, then it turned into fulfilling those orders, running demos, doing all this, while still signing up for all the events. And it became very, very time consuming.
When I say it was a full-time job, as you know, Maureen, being an entrepreneur, being a business owner, 40 hours is really not a full-time job. I would say at that point, I was probably putting in 40 hours in radio and 30 or maybe 40 hours in sauce.
Luckily I didn’t have children yet so I was able to do that but I was really around the clock between the two. It had become a lot but sauce was only getting 30 or 40 hours so when I say full-time it was barely full-time and it wasn’t paying like full-time.
Maureen: My story is so similar to that because I did the same thing. I worked a full-time job and any other minute that I wasn’t at work, I was working on Agency 29 and growing that and bringing in my own clients.
My husband worked an 80 hour a week job. And so he was never around. So I didn’t do much else, right? I went to work. I saw him on Monday afternoons, basically, and the rest of it was building the agency.
I think it’s such a difficult thing because now so much of what people want is balance, right? Work-life balance. And when you’re building, you really need to just give it your all in order for it to like take hold and gain some traction.
Pauly: Yeah, I hate to say it because it’s not a popular thing to say. I know, hustle culture, I don’t know how old you are, but I don’t think we’re too, too far apart in age.
Hustle culture was popular when we were young and building our things. But now in the last five, maybe five or so years, it really seems like it’s a curse word to talk about working around the clock.
A lot of people just don’t think it’s healthy and maybe it’s not. But if you want to be successful, it’s really, really hard to be successful. And the only way to really do it is to either get lucky and invent something or, and even in those cases, you still are probably going to work around the clock doing that. Or just work your freaking ass off.
Yes, I do like it. I’m honored, I know you are as well, but I’m honored to speak a lot in front of classes and aspiring entrepreneurs and things like that. I will talk about that.
I don’t know if that’s something that is bred in young people. I don’t want to be the guy who craps on young people. There’s a lot of beautiful things about young people. But I just don’t know if you tell a 22-year-old who’s aspiring to be something that they might be looking at 60 to 80 hour weeks for a few years. They don’t like that. They don’t like to hear that.
Maureen: I agree. It’s definitely a shift and and hey, maybe maybe the Gen Z’s and the Gen Alphas that are coming after that. Maybe they’ll all be better than us, right?
Because they prioritize their well being and their self care and you know, and their wellness and all of that. And you know, they won’t need therapy, but who knows? Or I guess they start therapy at like 10 years old. Anyway, I digress.
In my research for this episode today, I saw that your first day of production for Guglielmo Sauce was July 2nd, 2014, and you made 30 gallons.
How does it feel to reflect on what you felt going into your first big mass production, and then what you do now with Craft Cannery? I also want you to explain that, too. Let all the listeners know what Craft Cannery is.
Pauly: Yeah, that’s right.
Well, it feels so much the same that day feels like yesterday. I still feel like I am just trying the next thing and seeing if that works. And I still feel like one day some government agency is going to show up at my front door and go, we were onto you. We know that you don’t actually know what you’re doing, so you need to quit. You need to go back and get a job, right?
I just feel like such an imposter because I don’t feel any different than I did that day. I was like, well, we’ll try this and see if it works, you know, a little smarter, maybe a little bit more savvy. But no.
Craft Cannery is a contract manufacturing plant. It’s a place where, if you have a recipe for a sauce, you can come to us and we can actually commercialize it for you, meaning we can bottle it for you and make it so that it’s legally sellable in stores.
And the breakthrough idea on that was, I think every entrepreneur’s dream is, you find a problem that needs solved? I’m embarrassed because I’m talking to you because you’re so much more of an expert than I’ll ever be. So just tell me if I’m way off.
A lot of people, they say, well, I’m going to start a business. And they go, well, I’m good at baking and I like baking. So I’ll start a bakery. Listen, I did that. I like making pasta sauce. I made pasta sauce.
But did the world need another pasta sauce? Like, was there room for another pasta sauce? Does the world need the bakery?
And maybe it does. Maybe you found a town that just doesn’t have that little artisanal bakery. Or maybe you put yourself in between Savoia and Leo’s Bakery to make a local Rochester reference. And maybe it’s saturated.
Well, sauce is saturated. And while I love Guglielmo Sauce and it still exists to this day and that it will always be my baby, I wasn’t solving a problem with Guglielmo Sauce. I was just following a passion.
With Craft Cannery, we solved a problem. If you are looking to manufacture a food item at a small scale and you don’t have hundreds of thousands of dollars to get started, it’s really really hard to find anybody willing to do it for you. We needed to break down the barrier and it needed to be that if you just wanted to get a sauce on the market without jeopardizing your future by going into debt that needs to exist.
The other thing, too, is supermarkets like Wegmans, Tops, Price Chopper, etc. Even they want to diversify their offerings, their private label offerings, and can’t find co-packers willing to do smaller runs.
Wegmans might come to us to do an item that to us is a big item, but to another co-packer is a small item, so small that they might not even be interested in doing it. And so there really was room, there was room to be small to medium scale manufacturing. It was a problem that needed to be solved. I’m sorry about the really long answer but I think we stumbled upon it.
Maureen: You’re right. It was needed. But how did you go into that? You left the radio, you’re doing Guglielmo Sauce, you’re growing and scaling that and working on it. How, then, the jump to Craft Cannery?
Pauly: I’m naturally curious and I think that’s how I know you is I’ve just seen you out a million times, right? I’m out all the time talking to people.
Once I found this world, I was constantly out talking to other entrepreneurs, talking to Cornell University, which is like the Food Venture Center, which is like any local food processor knows them very well and learning as much as I could about this world.
And I just kept hearing over and over that it was small and didn’t exist. Now, I shouldn’t say it didn’t exist. There were only a few options for small scale co-packing
There was a middle ground between commissary and artisanal batch, 25 gallons at a time. And then the 10 ,000 gallon minimums. You might see big co-packers.
It kind of occurred to me, there was a lot in between there, but also occurred to me that I didn’t know much. So I found a small co-packer in Bergen named Coach Tony who actually was my first co-packer. And he was somebody who had a small little footprint in the area, but really wasn’t interested in growing his business at all.
In fact, he was a little older and even made it known he was looking to retire. And so I asked him, is there any chance you are looking to sell this business? And he was, in fact, at that time looking to sell it. And so he was able to buy the food safety plan, basically the intellectual property of how you do the licenses.
I had a small client list and the actual physical equipment and get started not having no idea what i was doing
Maureen: That’s a huge jump. As a guy who, at the top of this call, said I lacked confidence and I still have imposter syndrome and I feel like I’m kind of just… I call what you’re talking about, I call that the pursuit of interesting. I actually speak frequently on that whole topic of kind of following that long tail of, I don’t know, curiosity, right? Like this thing seems kind of cool. I’m going to see what’s going on over here.
What gave you the confidence to take the leap to buy that business? Because that’s a big, that’s a big shift, especially coming from 15 years of working for somebody else.
Pauly: It was a few things. So one was that at that point, Guglielmo was doing enough volume and Coach told me he only had these two 40 gallon kettles. Talking about being able to make 80 gallons and you can only turn them maybe two or three times a day.
So I had since grown Guglielmo to the point that I moved to a bigger co-packer where I was running 1000 gallon batches. So I knew that just by moving here that I was immediately acquiring a big client in myself. If I looked at myself as a client.
So I knew that on day one I had a client. The other thing is Coach Tony himself had a meat sauce, which had a nice little presence as well. And I knew that would be there.
So he did have a small client list also at that time. He had a few other clients like Red Osier, which had a pretty good local presence, and a small handful of other ones. I was walking in with a few clients ready to go, including, and remember, it’s all relatives. So when I refer to Guglielmo, I almost was a “big client”. Not a big client for LiDestri, but it was for only having two 40 gallon kettles.
I said, the math works out that if we can fill these kettles four times a day, five days a week, we can at least break even. And I’m doing enough in Guglielmo’s, Coach Tony’s, and Red Osier to be able to start out knowing I can keep these kettles full every day. That was the confidence.
Maureen: Then it had, you felt that it also had room to expand beyond those two kettles within the footprint that you had.
Pauly: Absolutely, yes. Physical space, bigger kettles, an automated bottling line because back in those days every jar was being poured by hand. So I saw that there was some low-hanging fruit to become more efficient very quickly, to bottle faster, and to bottle more. I saw that that wasn’t going to be that hard. And that’s funny, it was way harder than I thought it was going to be.
Maureen: Wow. And so what year was that acquisition?
Pauly: That was actually 2020, the very beginning of 2020. And another thing where, now this was just pure luck, but when you hear 2020, everyone’s mind automatically goes to COVID. But the truth about COVID with what we were doing, and I want to make sure I say this very delicately because personally, COVID, of course, was terrible. And for many businesses, the restaurant business, terrible.
But if you were bottling shelf stable pantry food items in April of 2020, not terrible, not terrible. So two months into this, we got handed a pandemic and at the very beginning of 2020, before supply chain issues and before inflation for a few months, it was just fine. We were getting everything we wanted.
All the food businesses were essential. So all the distributors were selling me anything I wanted and we were bottling and man, everything we made was sold the second we put the cap on. It was a really lucky break to open right at the beginning of COVID.
Maureen: Skip a few to Grow-NY 2022. Talk about that.
Pauly: Well, I went in 2021, Genesee County asked me to be their guest to work at their kiosk. So I went and I did a show hour at the beginning and then there’s these pitches.
So I went in the other room and I watched all these pitches and every one of those pitches. I mean, it was a lot of fun. I felt like I was watching TV. You know, I’m eating popcorn, like pitches like a Shark. It’s like I’m watching Shark Tank live. I was like, this is great.
But I was so impressed and intimidated because they were all so smart. They were so brilliant, these people. And the ideas, every single idea would come on. I’d say that’s the best idea I’ve ever heard. And then the next one would come on. I’d go, now that’s the best idea I’ve ever heard. And then the next one, now that’s the best.
And every one of them made such a good case for themselves. But what happened was that I heard, and at that time had heard many times, that there’s a need for manufacturing and man if that didn’t come up over the two-day Grow-NY.
If that didn’t come up at least a half a dozen times in either an entrepreneur or in one of the panels somebody said we need more manufacturing, here’s a need for manufacturing.
It occurred to me that all it really needed to do was get up there and say we’re a manufacturer and we’d have a leg up because everyone, even the judges were constantly asking where do you plan on doing your manufacturing? How are you going to find manufacturing?
So I was just like, man, I can just go up there and say I’m a manufacturer. It seems like I’m going to fit a niche already. And I’m Googling past years and nobody was really manufacturing. Not nobody, but it was rare.
So I just started asking people if they thought I was crazy and everyone was like, no, you gotta do it. Apply. You gotta do it. You gotta do it. And we applied. And, I think part of the reason maybe we got accepted was because I had a kid who wanted to make hot sauce who didn’t want to pay our startup fees, but he was a video editor.
And so I went, I have an idea. What if? And you already know where that’s going. Let’s trade the startup fees for you to make a really good sizzle reel. Because, at the time, Grow-NY was like, send us a two minute sizzle reel.
He made us a dynamite two-minute video and we waived his startup fees. And that video, I feel like that’s what got our attention because it was optional to send a video and we did it. It looked really good.
Maureen: I do first round judging reviews. So when those applications come in every year, there’s 20 of those first round judges that review 20 applications and then choose. And I can tell you those videos do really make a difference because they bring the personality to the table, right?
Whereas otherwise you’re just reading content and you’re trying to get an idea of somebody’s vibe and passion and like their confidence in their business that can really come across in a two minute video. Makes a huge difference.
Pauly: Thank you. Thank you. Thank you.
Maureen: The other thing I’ll say too is you just mentioned that you did that on trade and that’s something that Agency 29 has done over the years too, a number of times.
You’ve got something we need, I got something you need, let’s trade. And so I think that’s an underrated thing that’s not typically talked about. Like entrepreneurs working together in that way is a great thing.
Pauly: Yeah, I learned that from radio. They used to trade everything. Our bosses, my bosses in radio would trade everything and then that’s how they, yes, you want a Jeremiah’s gift card? Here you go. Here you go. Here you go. I learned that there.
I’ve done that a few times here, too. You’re right. Trade every once in a while. You just kind of look at each other and say exactly what you just said. You got that. I got this. What do you say? It works. Yeah.
Maureen: You’re right, it has to be balanced, you know, can’t do too much. you, anytime I talk to you, you are, and you mention your partner and mentor, Tom Riggio. When did he come into the picture? Je was pre-Grow-NY, right?
Pauly: Yeah, he was even pre-Craft Cannery actually. It was 2000, maybe 16 or 17, I would say. I went to a happy hour at Iron Smoke Distillery in Fairport and he was an investor there. And we started talking at this happy hour and he just started asking me these really pointed questions. And I don’t know what they were, but they were really specific and really put me on my heels because most people just throw you softballs in real life, you know?
He was asking, how’d you get into Wegmans, right? This guy’s asking me about really specific stuff. So I’m like, who are you? And he’s like, we should get lunch.
We met for lunch. And one of the very first things he said is, he said, I am an investor, but I just want to be friends. I’m not here to try to invest. The only thing I ask is, if you ever are looking for investment, just come to me first. That’s all I’m ever looking for.
And so, you know, Craft Cannery, that’s exactly what it was. With Craft Cannery, it was like, okay, I need some money to do this. Then we became really good friends for a couple of years. We’d meet for lunch once every couple of weeks and I would just tell him everything was going on in my life.
He just gave the best business advice, the best business you’d like him to, because he’s a big brand guy, big, big brand guy. Really good dude. And so I did bring him the idea for Craft Cannery.
Maureen: Yeah, I’ve had coffee with him. He is a great guy.
Pauly: I just kind of laid it out for him on a napkin. I had made SWOT analysis, which was like the most work I had ever done towards a business plan. Here’s my strengths, weaknesses, opportunities, and threats.
And we sat for like a four hour lunch one day. And I guess he went for it. He said he knew that I would just work day and night to make sure it worked. And I’ve told him before, if this plays, I’m not saying this place won’t fail. If this place fails, that could happen.
But I promise you this place is going to fail, it’s going to go down in dust and smoke and, like Khaleesi from Game of Thrones, I will be standing in those ashes being like NOOOO NOOOO. It’s my everything.
Maureen: That’s why investors invest in people. Investors know generally whether a business is going to do well or not by the spirit of the founder.
Pauly: Yeah, I appreciate that. I mean, he says that too. And I do think manufacturing, it’s kind of safe, not to say that it never fails. It can, but it’s kind of safe, but it’s also not offering when you do eventually sell your business, you’re not getting 20 and 30 time multiples like some of these brands, CPGs will get.
And so manufacturing, sure you can sell it and sure you can just make money off of it for a long time. But I don’t know if you’re ever going to sell it for 20 times what it’s worth.
That doesn’t happen in manufacturing. So that was kind of going against the grain for him because he’s looking for that 20x, 30x. So that was the one thing that needed convincing.
To this day, I mean, he was here today, he was here this morning with the construction, with the builders just to give me backup, give me backbone because I’m not an expert in anything. To be honest with you, a lot of people tell me I’m not an expert in anything. So I need as much help as I can get.
Maureen: So just to backtrack on that, you were one of the winners of Grow-NY in 2022. And part of your pitch was we need investment to expand the facility to serve more businesses because we’re at capacity. There is still more need and we want to be able to help support more CPGs. And so we need to expand and that’s what you’re doing now, right?
Pauly: If I could just say one more thing about Grow-NY, because I just know how closely you work with it, that my pitch sucked when I first started. I wrote a pitch and made a PowerPoint. I started, we went on a walk, me, my wife and my son went on a walk and I started down my pitch and I was talking like an entrepreneur.
I don’t know if everyone will know what I mean, but you know what I mean. I was talking like I was in a boardroom full of venture capitalists and I was using words that I don’t even know what they mean and I was trying to structure myself and I remember my wife just being like what are you talking about? Like you don’t even sound like yourself.
Then I just went back to old radio stuff and I just said let me just do this again. Let me start over. Let me start from scratch and let me write this thing like I was talking to you over a beer at a bar and I’m not going to worry about sounding smart because everyone else is going to sound smart.
I’m going to go up there and frankly, Maureen, I thought to myself, I’m going to go up there and I don’t know if it sounds dumb, but I’m going to sound like a regular person and not use words that nobody knows what the hell I’m talking about.
And that was the breakthrough moment. And I don’t know if you remember my pitch at all, but I really didn’t. It was not overly structured. It was every slide.
I knew what I was supposed to talk about, if you heard me do that pitch ten times, it was different all ten times. Which scared some people.
Maureen: I think also that that approach is what sold you as an authentic person, right? That you weren’t there, that you wanted the money because the opportunity was there. You wanted the money because the opportunity was there to help others.
That came through. And one of the things I distinctly remember from not necessarily your pitch, you did a great job on the pitch, but it was Q &A and you got a question about diversity.
Diversity is very important to Grow New York. And you got a question from the judges about, well, I see a picture of your team up there and it’s not very diverse. What do you think about that? And you answered authentically.
Pauly: I was like, I don’t like it either. It sucks. That’s the best fit. But that’s the best I can do when I put out applications. That’s who applies. And honestly, like, I just thought it would be so I was so happy I got that question.
And it’s for such a superficial reason, because I should be happy I got that question because we need to do more to diversify our workforce. And of course we do. But I was happy I got that question because I knew that if I could say I don’t know the answer to something in a really specific way, it can’t be like an important question.
It can’t be like your numbers. Like you gotta know the answers to your number question. But if I could say, I don’t know, but I’ll find the answer for you, that would be so different than anything they’d ever heard.
That gave me the ability to go, I don’t really know why there’s no bus routes coming out to Bergen, but I can’t draw from the city unless there are. I did talk to so and so about maybe starting a carpool thing. But I don’t know if that’s going to go anywhere either and I got to actually say I don’t know.
I feel like that’s refreshing. It’s authentic, you know, and then but then my authenticity also screwed us though because we got asked a question about selling the business. I didn’t realize they were asking, what’s your plan to sell it; we’d like to hear that you have a plan and my answer was like, never.
Maureen: Because you wanted to send the message of I’m sticking around, I’m not going anywhere. You don’t have to worry about it, right?
Pauly: Yeah, but in retrospect that was maybe not the right answer. It needed to be like, yes, we do have a plan. There’s Tom, luckily, to back me up on that one. Thank God, because I would have gotten us in trouble.
But to your original question, which was the expansion, yes, basically we were turning, we were and still are occasionally turning away business.
We just had the opportunity to get salad dressing from a very major local supermarket and it was just over our head. We just could not, we would have failed. And leaving money on the table, I knew that would get their attention. I knew we had a really good reason.
Grow-NY was like my slumdog millionaire moment where I’m going, it seems like they made this competition specifically for me because all the things they’re asking for kind of play right into what my business is doing.
And then, one other thing, there was an edit that was made the day before the pitch too, which was I also realized that we were making money and we were profitable and that wasn’t necessarily the case for everybody.
So I added a line where I said that. I said, we have made X amount of money and we’re profitable right now. That was added. I needed to make sure that I got in. And the fact that we were leaving money on the table every single day by not expanding, I thought would really resonate. And it did, and it was true.
We are expanding but here’s what’s funny. That was almost two years ago and we are still. I mean we’re just about to open the physical expansion but the equipment everything’s not really truly going to be in place till June. Two and a half years from standing on that stage to it actually being happening it’s crazy how slow things move.
Maureen: It takes forever. And especially as an entrepreneur, right? You get something in your head and you’re like, let’s go. I don’t know for you, and I’d love your thoughts on this, for me, like when I get a feeling that I know this is the right direction, I don’t, I don’t want to slow down, right? Like I want to go and there is no stopping me. And so it’s, it is that much more frustrating when something takes time to get something into place.
Pauly: Yeah, this is the lead time. Like, we bought a bottling line as a 12-month lead time. The construction was supposed to take four months. It’s going to end up being six months. We didn’t do anything wrong. It’s just life. Just little shit happens. I’m sorry. I’m not supposed to curse.
Maureen: I also think that having a business with a partner and having a business without a partner is a very different thing and so, Guglielmo’s no partner, Craft Cannery you decided to bring in Tom.
What was that like because you know you spoke to like you guys have been had been you’d become friends you saw what an expert he was but what was the kicker for you of like, I think I should bring him in on this.
Pauly: I felt like I needed somebody who would keep me on the rails. If I have a weakness, a major weakness as a business owner… I’ll give you a specific example. I don’t even know how to characterize it. So I’ll just give you a specific example.
I did all those events all throughout Google, Amazon’s farmers markets, festivals and stuff. And, and you know, if you look at the net return on those things, you know, it’s not great. It’s not great to go out and sell jars of sauce for a whole weekend.
Then you look at how much it burns you out because now you’re working a five day week, both days of the weekend and another five day week, then another two days. I was working plenty of 19 or 26 day work weeks.
I was still doing that for the first year or two of Craft Cannery. 2020 was a nice break, but 2021 I still did that. And maybe early 22.
I came to him with the idea of, let’s hire a promotions team. Let’s go around the country doing these events. Let’s grow the brands by just going around the country, signing up for all kinds of things. Let’s hire a whole events team, including an events coordinator full time here at the office, and then a team of people to go around.
And he was just like, no, stop it. We are manufacturing. We need to become good at manufacturing.
We are just on the tip of the iceberg of becoming good, profitable, successful manufacturers. Do not shred your focus now into thinking we should be signing up for farmer’s markets in Pennsylvania and arts festivals in Florida. He’s like, that will consume you.
And we already know the net returns are not there. Then he went to the numbers and he said, what was the net return on such and such festivals this weekend? Okay. Now what’s the net return on 8 am until noon this morning of all the product we ran through that bottling line at 20 bottles a minute.
And the math on that didn’t add up. And so what would have happened if he wasn’t there? What if he wasn’t there? Do I hire that events person? Do I start that promotions team? Do I fall miserably on my face?
I mean, there was a really good example of that. But there’s been a bunch of smaller, more insignificant or significantly smaller versions of that same story that happened over the last few years where he’s just like, hold on, focus, stay here, manufacture, get good at that, get efficient.
Another one was when we realized our competencies. I was so scared as an entrepreneur that I would just say yes to everything at the beginning. And I took some clients we shouldn’t have taken.
I took some projects that weren’t profitable. There were what looked profitable on paper but what’s the given the doors you know what now you know you’re just you’re losing your ass on stuff and he was also somebody who said we are competent at this. Find more people who want to do that.
He’s been unbelievably important in our growth here. He’s not here full time, so it’s not like he’s actually here full but he’s here at least once a week. So he’s putting a ton of time in, which is awesome.
Maureen: An incredibly valuable contribution, too.
Pauly: Absolutely. We would not be here without him. There’s no doubt. I get way too much credit for it. If it was just me, I don’t know. Maybe I could have gotten a bank loan instead of gone to him for the financing for this. But would I have just shit the bed six months in? Like, I have no idea. Maybe. Maybe I would have. Maybe not. I don’t know.
Maureen: Right, or perhaps the business would be in a very different place now without that expertise, right? And you would have gotten there, but it would have taken 10 years instead of five or 15 instead of eight. You know what I mean? Like it would have taken twice as long, you know, for you to find your footing because you had to learn those mistakes along the way instead of learning them from somebody who knows and can offer that expertise. That’s great.
Pauly: We were doing, you know, hundreds of thousands of dollars in business and Craft Cannery doing millions of dollars in business. And without him here, he’s played in those pools before. To him, what we’re doing here is still pennies. But to me, it’s the most I’ve ever done.
So having somebody in the room also to be like, you know, it’s not as good as you think it is, but it’s also not as bad as you think it is at all times. It’s never as bad as you think it is. It’s never as good as you think it is. Stay humble, stay focused, what’s our core competency, we are manufacturers. He’s that guy, he’s that guy who keeps that on the rails.
Maureen: I love it. So a slightly lesser known fact about Paul Guglielmo is probably that your family owns Redbird Market in Fairport, right? And so you have an immediate outlet for Craft Cannery. That story is similar to the one that led to your Craft Cannery acquisition too, right?
Pauly: You’re right. I love that with our startups. I love being able to say not only will we make your product, but I’ll give you your first shelf space too. That is a huge thing.
I had a delivery driver at this point and she called off one day. She couldn’t be here that day. And so I went out and made deliveries one Friday afternoon and I got to Redbird Market and the woman who owned it at the time, Luanne, was in there and I delivered my sauce.
She says, “Well, Paul, I guess I should probably let you know this will be your last delivery to Redbird Market.” And I was like, no, why are you kicking us out? She was like, no, no, no. She said, “My husband and I have decided to retire. We’re going to call it a day. We’re going to work through X date, whatever, and we’re done.”
I told her I’m surprised you didn’t sell it. It seems like you’re busy all the time. People really love this story. You’re really well known. People have heard of it. Like, gosh, I’m surprised you couldn’t find a buyer.
And she’s like, well, actually, fact, you’re the first person I told. And I was like, could you do me a favor and tell nobody else? And like, you print out like just a few, I don’t know, profit and loss reports? Like, could you just print out some stuff for me?
And she was like, sure. She got what I was saying and called my accountant. Within about a week, we met with her again and we’re saying, yes, it’s not this monster juggernaut, but it’s profitable. People love it.
It’s everything I said. It’s profitable. People love it. It’s busy all the time. It’s a real key piece of Fairport, which by the way, Fairport has come alive and become this vibrant little village with walking traffic galore and, yeah, went to the accountant, went to my wife and my mother-in-law and we all just kind of agreed.
My mother-in-law hadn’t worked in some time. She raised a family. My wife I just knew at that time she was working at Dixie’s. And so I knew she wasn’t going to do that for much longer and that she wasn’t necessarily interested in being in the agency world any longer and that running a little market would be literally her dream come true.
So it just kind of fell into place and it’s been a couple of years there as well and it’s really really sweet. It’s just this great little grocery store that people love.
Maureen: I think that that also goes back to what you were talking about earlier. You’re just a curious guy, right? Like you asked, she said, this is going to be your last drop off, you know, and you’re making conversation and then you’re like, wait, this is kind of interesting. And you’re asking more questions and then boom, now you own it, you know?
Pauly: I always say I get lucky, but people use that exact interaction with Luanne that day to say how, you know, really luck is more like opportunity.
What is the saying, opportunity meets preparedness or something like that? And it really was, you know. I had cultivated a relationship with Luanne over years and she felt comfortable sharing that with me. And there was some luck involved in that I made that delivery that day. But other than that, it was preparedness meets opportunity.
Maureen: Absolutely. All right, last question for you. Tell me about a high point and a low point from your career.
Pauly: The whole career, not just Craft Cannery? Holy crap. So I would say a high point is something, it’s probably a corny cop out answer, but it’s the high point is the fact that this has been going on this long that I’m actually paying my bills, feeding my family with a business that I started under a 10 by 10 by 10, 10 years ago. That.
I lack so much self-esteem and so much confidence that that’s that one thing that I can say that I just can’t even talk myself out of. Because I’ll talk myself out of anything you think is good about me, I’ll convince myself, yes, but it’s not really good. That’s the one thing that I’m like, that really happened. We really just went out and did that. That really happened.
The low point was June of 2020, one month into running Craft Cannery, sitting exactly where I am right now. One parking spot over actually. I came out to my car and I cried, real tears, because we were just bleeding money.
We had just started and the very beginning of business was tough. Cash flow, man, cash flow gets you right off of that. So I came in here and the very first thing that happened was I started day one making people’s products.
But here was the flaw in what we were doing. We were buying everything a couple of days ahead of time meaning I needed the cash to buy it. And I was making their products and then billing them net 15, net 30.
So I put myself in an immediate cash flow crisis. I came out here, I cried because I was looking at payroll and I was like, it was like a Wednesday and I had like nine days left of operating income. And I was like, how did you fuck this up so bad in five weeks?
I really had the business for five weeks at that time. Like how did you get yourself in that much of a cashflow pinch? And I took a breath and I thought about it and I figured out that it wasn’t a crisis.
I mean the business was bad. It was a crisis, but it wasn’t an overall, it wasn’t a deal breaker on the business. It was that I had mismanaged my cashflow. I mismanaged the idea of getting credit and giving credit and I was spending all this money and being a fast payer while simultaneously allowing people to be slow payers to me.
And so that was it. I flipped that. I made a bunch of phone calls that afternoon. I convinced everyone that I owed money that I needed to be on net 30 terms. And I convinced everyone that owed me money that they should be on net 15 terms with me. And it righted itself over those next couple of weeks. I offered a couple cash discounts. I told people, if you pay within the next two days, we’ll give you a small discount or something.
But that was the low point. I remember just sitting there thinking, how am I this close to being out of business already?
Maureen: Well, I think a good lesson from that is, and I remind myself of this when I’m in a really tough place, everything is figureoutable. That’s a Marie Forleo’s phrase. I think she has a book with that title. Everything is figureoutable, which I haven’t even read, but I just that whole phrase in and of itself is like, is not, life will go on, whether you like it or not.
And so you can figure this out or it’s going to get figured out for you, right? Like things are going to happen to you or you are going to make things happen.
And so that’s what, when I’m in a bad place like that, and I’ve got stories too from my tenure of growing Agency 29 where I’m like, mistakes were made.
Just to tell a brief story, we once printed a job. We were hired as a freelancer through an agency. So the agency had the client and they were a big higher ed institution. That higher ed institution had hired the agency who had hired me because they knew I needed the work as a freelancer. So we designed this annual report book and we had it printed and the stock was too heavy. When you went to open the book, it cracked the seam because there weren’t enough pages. It was just too heavy.
And so it was like the whole thing had to be rerun. There was a cost. Just the whole thing was a disaster. And I’m this little tiny baby. I had just left my full-time job to do the agency full-time, you know, and I’m like, I have just royally fucked up. And I didn’t have the same everything is figureoutable mentality at that point, you know, and I remember some very difficult conversations with that agent agency to explain what happened so that they could then explain it back to their client. And it all worked out.
We made it right, like reprinted the job. I think I paid for the cost of the reprint or some of it, you know, and I think the agency covered the other part because they had approved it. It was a whole thing.
But all that to say that I like to ask about these episodes of a high point and a low point, because inevitably those low points lead to what happened after that, right? That I learned a really important lesson and I became stronger as a result of that and now we operate differently because of it.
Pauly: I mean, I’m curious. Well, in my case, it was cash flow management, you know, a really important skill that at that point I just didn’t have. And I learned it that day.
But in your case, I’m wondering, where was your confidence level at that point when you did that job? Were you questioning your own? Were you questioning your own competence going like, I can’t even print a job, right? What am I doing here? I can’t even print a job.
I’ve done that several times here where I’m going, what business do I have running a manufacturing plant? We can’t even put sauce in a pouch without getting the scene dirty.
Maureen: There have definitely been moments over the years where, yes, I’ve questioned. This is, this was all a huge mistake and I need to just go get a job, you know, like go get a real job out there.
I will say, I hired an executive leadership coach in 2019, 2020 to help me build my confidence. And I put in the real work on that for years, met with her once a month or twice a month for years to build that confidence.
And now I no longer have that imposter syndrome. Things happen and I feel competent and able to apply that. Everything is figureoutable mindset, like bad things happen. And I’m like, okay, a bad thing happened. What am I going to do about that? And sort of let myself sit with the problem and then I come up with the solution.
Whereas previously something bad would happen and it would totally derail me. I would be stressed. I’d be angry. I’d take it home to the family. It would impact my sleep, everything. It permeated every aspect of my life. And I was like, this has got to change. And so that was one of the best things that I did in the business was commit to that work.
Pauly: That’s so smart. I’ve heard that many times. I’m in therapy, not executive coaching, but actual therapy, and it helps. But executive coaching, I think, is a whole other level that would be a really valuable thing. I’ve to do that. I’ve heard so many people say good things.
Maureen: Really, it’s a question of, are you working on improving your most valuable asset, which is you. And no matter what that looks like for you, for some people it’s therapy, for some people it’s coaching, like leadership coaching, for other people it’s business coaching.
I’ve hired business coaches too, like, here’s all my books, tell me what’s wrong in my profit and loss (P&L). I’ve hired those consultants, too. It’s just a question of do you have a mindset of continuous improvement, of doing something to improve every day in some aspect of your life.
I think that, you know, it’s good for you to be doing the therapy. And once you feel good and a good place on that, and it feels right to hire a leadership coach, then that feels like a great next step. But it also feels like you kind of have that in Tom.
Pauly: Yeah, I think so. Yeah, I kind of feel like I do have that in Tom. A lot of that stuff he’s taught me. He taught me how to read a P&L, and how to understand the information I was digesting.
You’re right, I kind of do have that in Tom. But I don’t think that it would be a terrible thing to have a complete stranger to occasionally bounce things off of. That being said, they probably don’t stay a stranger for long, you know.
Maureen: No, they don’t. Not the ones I like anyway. You really connect with them on a deep level, but Pauly, thank you. This was great. Love to be able to “re” hear some parts of your story and hear new little nuggets of other parts of your story and be able to share with the listeners how, you know, it went from a humble sauce maker to the empire that you’re building over at Craft Cannery. So thanks for taking the time.