Ali's Banana Bread

The best baker wins worldwide: internet distribution beats the local radius

Shaan argues that before the internet a baker was capped by their 5-10 mile local radius, but Instagram food brands like Ali's Banana Bread can ship worldwide with $0 marketing. The combination of cloud kitchens plus direct-to-consumer (collecting fan phone numbers, texting one drop photo) lets the single best maker of a thing become a multimillionaire.

“And so if you're the best at making something now, you have a pathway to become like a multimillionaire, where that really wasn't possible if you were just a local baker in whatever, in Cincinnati. You know, you were always restricted by however many customers you could get in your local radius.”

Steal thisIf you make the best version of a niche product, sell it direct via Instagram drops instead of fighting for local foot traffic.

Private equity will roll up Instagram food brands as the next Ben & Jerry's

Shaan predicts PE firms will buy up cloud bakery brands like Ali's Banana Bread and 1-900 Ice Cream, scale them with advertising, and push them into retail — the way a meme-account company sold for ~$100M. He says he'd cut each of the four brands discussed a $25K check today.

“You're going to see a bunch of private equity companies coming in and they're going to buy up, you know, Ali's Banana Bread. They're going to buy up One-Nine-Hundred Ice Cream because they're going to be like, Dude, this is the next Ben Jerry's. And we're gonna take this thing, we're gonna put it on steroids, we're gonna advertise the fuck out of it, and then we're gonna get it into retail stores on top of what it's already doing.”