Business of Longevity: Research & the Evolution of the Supplement Market with AG1 CEO Kat Cole

Thank you, Fre, thank you.

Yeah, Wharton so far. Harvard's lagging.

There are a few. Good morning, everyone. Hello, friends. Hello, hello. Good morning, good morning, good morning. And we would love for this to be a jam. It's intimate, it's the morning, so if something comes up and you want to interrupt, please do. This is not a talk per se. Yeah, we've got a mic, so questions are not just at the end — they can be throughout the whole thing. And so I'll go — typically I start from the beginning and go backward, but I'll start from the beginning and go forward.

I'm the oldest of three girls, I have two younger sisters. I grew up in Jacksonville, Florida. Both sides of my family — my mom's side, my dad's side — were incredibly, incredibly poor. I mean, if they were employed, they were truckers, junkers, factory workers — like good, honest blue-collar work. But many of them were not. A lot of drugs, a lot of suicide, a lot of addiction, a lot of incarceration. And I like to say it's sort of like Jerry Springer. But when I say that, when there are a lot of young folks in the audience, they don't know what that is. So it's like the Kardashians, but poor. Like drama, think drama, but poor. So that was my family.

Except my dad was an executive at an auto imports company, and so we had a house that was not on wheels. We had a car and we had gifts every holiday season. And so by comparison to both sides of my family, we looked quite wealthy. And so for many years, my mom struggled with what was the tax she paid for that economic stability, which was my father's alcoholism. By the time I was nine years old, I had been in three car accidents with my dad drunk driving. My sisters were six and three, and my mom had people for years — as you can imagine, her sisters, my dad's family, her mom — saying, 'Just be grateful. You're lucky. We all have to deal with this stuff, but we don't get a house, so be grateful.' And for many years she was, and she did her best, but she was raising us on her own, essentially.

And so when I was nine, she came to me and said, 'That's it, I'm done, we're leaving.' And what she meant was we were leaving my dad. And he was and is truly such a sweet man, but at the time a terrible husband and father, even if you only look at the one example I gave you of the safety issues we had. And so when she came to me and said we were leaving, I did not cry and I did not get upset. At nine years old — this is her story that she tells — at nine years old I looked at her and said, 'What took you so long?'

And the lesson in that that I've learned is that the people who are closest to the action know what the right thing to do is long before the leader makes the call. But people who are close to the action lack two things that leaders have: they lack the knowledge, the perspective to know the scalable problem or a scalable solution, and they lack the authority to do something about it. So it takes, one, a leader staying very close to the action, which is actually the first life experience that underpins the techniques for leadership that I'm known for. They're all a version of asking questions, getting honest answers, and acting on it, and then repeating — but by staying close to the action.

And so we left my dad. My mom fed us on a food budget of $10 a week for three years. She worked multiple jobs. She had no playbook, no mentor, no help. And that was my example. And so if there is anything I can point back to that has created my ability to enter unusual circumstances at very young ages and demonstrate a level of maturity and leadership, it is observing her, just through osmosis, right? She's just about badass without a playbook of how to be a badass. And as a result, though, we now were very, very poor. We didn't have all of the things we had anymore. My father didn't pay child support, he ended up going to jail, and he is now sober and remarried, and it all ended up fine and great. And my two sisters and I are exactly what my mom wanted us to be, which is independent.

So I started working when I was 15 in malls, then added a few jobs cleaning gym equipment and becoming a hostess at Hooters restaurants, which, if you're not familiar, is an American restaurant chain known for chicken wings and waitresses who wear little white tank tops and orange shorts. So there's this sex-appeal element to the wait staff. It's a sports-casual dining restaurant, but it was in Jacksonville, Florida, and Hooters started in Florida, so it was not controversial. It wasn't a big deal. It was just a beach-shack restaurant where a lot of high school seniors went to go get their first job, some working in the kitchen, some working in the front of house.

So I became a hostess, then a waitress. First person in my family to get into college. I was an electrical engineering and computer sciences major, psychology of women minor. And some crazy things happened. Hooters was growing around the world, and when I was 19 years old, after working many jobs in the restaurant — even though it was just my way to pay for school — I got a call from the corporate office and the manager, who said, 'Hey, we're opening franchises around the world. I want to nominate you to be a part of the training team. Will you go to Australia in four weeks?'

I'd never been on a plane. I did have a passport. I'd only been out of the state of Florida twice in my life, for track and cheerleading competitions. But I said yes. Then I flew to Miami, my first ever flight, got a passport, went to Sydney, Australia, and started opening Hooters franchises as a teenager. And I thought, who would ever give a girl like me a chance like that again? I mean, it truly seemed — even though from the outside it's like a Hooters girl traveling, you know, some people say, 'Who cares?' — but to me it felt like such a big deal. And the reality is, the answer is Hooters gives people like me a chance like that again every 60 days. I was in another country. Fast forward, in a year I'd launched the franchise on four continents. I was also failing college, so I'm a college dropout at the age of 20.

I then took a corporate job, moved to Atlanta, and then fast forward, as the company grew, I grew. At 26 I was the vice president of the company, doing $800 million in revenue, helped grow hotels, casinos, vertically integrated food and beverage, supply chain companies we ran. We had an airline. I ran an airline — Hooters Air. It was a thing. It was a terrible idea, but look it up. There was like an owl on 737s and Hooters girls in orange shorts. They were not the flight attendants, they were just entertainment, doing quizzes and trivia and passing out wing-flavored chips. And we had a Hooters MasterCard. I mean, it was the dream of a multi-channel branded enterprise that was a bit ahead of its time.

And all in all, I was there for 14 years. I mean, it was my family. I learned so much. I'm so grateful for my time there. And then I was recruited by a private equity firm to come join their business and run their portfolio company, Ro Capital, out of Atlanta, Georgia.

I went back to business school nights and weekends, so I have a master's without a bachelor's in international business. And they recruited me to run one of their troubled companies, which was Cinnabon, the cinnamon roll bakery chain. If you've never heard of Cinnabon, it's a bakery franchise famous for a cinnamon roll the size of your face, and at the time it was only in malls and airports. This was the heart of the recession. There were two things people stopped doing during great recessions: they stopped shopping and they stopped traveling. So my franchises had three years of double-digit sales declines, most of them were nearing default on their leases to mall developers who give you no grace if there are no human beings walking into your location. So I inherited a beloved brand but a broken business model.

We turned it around, built a multi-billion-dollar multi-channel enterprise, which was also ahead of its time — 2010, '11, '12. Then I became president of the parent company, which was managing nine presidents, $5 billion in revenue: Moe's Southwest Grill, Schlotzsky's, McAlister's, Seattle's Best Coffee, Jamba Juice. Took it private from being public, made it slightly healthier. And then over time I realized I'd become so passionate about nutrition. I had kids later in life — my kids are five and seven. I had my first at 39, my second at 41, two miscarriages in between, one before I had my first. And I went deep in nutrition, health and wellness because not only did I want to be healthy for my kids, but my mom was also diagnosed with breast cancer at this time. She's great, she's a seven-year survivor. It's amazing. So I come to nutrition very honestly.

Um, but it wasn't my life's purpose when I was a teenager. And people will often say, 'Well, how is this — like, Hooters to Cinnabon to AG1, nutrition — does that even make sense? Are you a hypocrite?' I'm like, no, man, we're all on a journey, and so I'm atoning for my sugary sins, let's say that. So I then left Focus Brands after running these companies for a decade and took a year off. The founder of what was then called Athletic Greens, now AG1, heard me on a podcast, asked to be introduced, asked me if I could advise them. That's what I was doing in this season of my life, so I said sure. I was already a customer; it was helping me a lot with my gut health after my second child, and I fell in love with the brand and the business. And even though it was much smaller than the businesses I had run prior, it was clearly my purpose. Like, I belong here. I am here to help this founder and this company achieve what it can, to help people on their health-ownership journeys. And that was three years ago. And we raised a round of financing, $120 million at a $1.3 billion post. We've 4X'd the business since then and still only have one product and one channel. So it's pretty crazy. That's going to change soon, though.

Yeah, I mean, you'll hear me use the word journey a lot. Even family, it's a journey. You know, when we had one child and my husband was moving to Atlanta from New York, and he was in tech and I was running Focus Brands, the way I prioritized that was just straight-up divide and conquer, right? There are two of us, there was one of him, we could split up, we could share. But we had no family nearby, so all the help we needed was paid help, and I was fortunate enough to be able to afford that. But much like running a business: get help, ask for help, lean on help, build community where there are loving friends and the chosen-family aunties and uncles who want to come love on that beautiful human, and then pay for help when you need it.

And then when we had a second child, and my husband's business — he's in venture capital, but he is also an ultra-endurance athlete as a hobby. He's rowed across oceans, he's circumnavigating the globe on only human power in his spare time, and that is his dream and that is who I married. And so none of it stops with kids.

And when we had our second child, my daughter Arrow was very, very sick. When she was a seven-month-old, she almost died twice. It was right when COVID hit; she had a respiratory virus and she couldn't fight it on her own, but there was a nursing shortage. If you all remember when COVID hit, there were no tests. And I remember so distinctly — in terms of like the business of the family — I remember being in the hospital, my daughter having an NG tube, a feeding tube, because she could not swallow, she couldn't feed herself. And she — I mean, it was awful, awful. And I had these AirPods in, and all of my business, which was franchise restaurants at the time, was decimated overnight. All the operating expenses, zero revenue, goosed. And it started happening a little early for us because we have businesses in Asia, so I saw the tidal wave coming of total demand shutdown. And I just remember this moment where I'm in the hospital, and there would be another one once we took her home — and she's great and fine now — where I had my AirPods in, the doctors are coming in, they're kind of debating over what to do with her, there's a new nurse fresh out of school because the other nurses had symptoms and they couldn't test and couldn't be there, she's sick, my husband's trying to help pull shifts and come in with me, and I have my AirPods in listening to my franchisees absolutely freak the hell out. And I remember just...

thinking — and to be clear, I was in tears every day, every day — but I remember thinking, 'I'm glad it's me.' I'm just glad it's me. I'm glad it's me for them, I'm glad it's me for her. You can like feel that energy, whatever it is, that mama-bear energy, that leadership energy. And sometimes you have to just tell yourself that, to remind yourself you're glad, to step in. And so the business of our family, for my husband and I, is all about gratitude. No matter what hits us, the moments that we get what we call our frequency gets off — like we literally met, had a one-night stand so we thought, and then that was it, and then he left to row across an ocean two months later and we got closer and we tattooed our rings and we got married at Burning Man and started having babies.

And so we've always said like, he's my magic magnetic puzzle piece. We are tuned into the same frequency, but when stuff happens in life, we get off frequency, right? You can feel it, it's like, 'Oh, you're on a different radio station than I am right now.' And so we use the frame 'I'm glad it's me' — like deep gratitude — but in 'I'm glad it's me' is also responsibility and accountability. And so that's how we run the business of our family: get help, be grateful, take accountability, be on our own journey, create space, and don't let anything misframe what is the most important. And unfortunately, I've had moments where the things that are most important are, you know, a little bit put in question with Arrow's health and my mom's health, and those are important reminders.

I think for most of us there are two core drivers. One, let's assume we're eating healthy. Our company ethos is whole food first, whole food, whole food, whole food, whole food first, always first. Even when we do that well, if we're eating in the modern world, our food is traveling hundreds or thousands of miles. It is losing its nutrient density as it travels over time. And even if it weren't, in most agricultural conditions our soil is depleted, and so the food is starting with less nutrient density in many cases, and then traveling, losing some of its nutritional benefits. You still get fiber, especially if we're talking about plants — you're still getting the fiber and lots of other benefits, but it's literally losing its vitamin content, as proven in any type of third-party study and research that you can conduct through the agricultural supply chain. So at the same time that our food is becoming less nutrient-dense — and I just gave the example of those of us who are eating as healthy as possible — the reality is we know that that is not always the case, or the case at all for many, where the nutrient density doesn't exist in the first place. So: less nutrient density.

Then add in microbiome, gut microbiome disruption from all the things that, if you're here at Summit, you probably know quite well, and some of you are likely researchers, professors, are experts in this. Whether it's stressors, the food system, modern, even if helpful, pharmacological interventions — these things disrupt our gut microbiome. If you haven't watched the Netflix documentary Hack Your Health: The Gut, it is such an interesting and digestible — pun intended — overview of what's going on with our gut microbiome. And the headline is it's just less diverse than it used to be. And that diversity of bugs is what helps us be more robust and resilient to the things that we navigate. And there are a lot of reasons for that. We are very sanitary, we don't play in the dirt as much, we don't eat seasonally — there are all kinds of reasons. And so you've got lack of nutrient density, a less robust gut microbiome. At the same time, we're putting our bodies through stressors that require a more robust gut microbiome and more nutritional support.

So these two things are moving apart, right? What we're doing — and by what we're doing I don't just mean the bad parts of the modern world, I also mean the great parts: the fitness, the endurance, what we physically are putting ourselves through, the running families and businesses like these are additional layers of energetic requirement that require a healthy gut microbiome and more nutritional support. That's the gap. We're doing things that make us need more, and we're getting less of what we need naturally. Enter the literal definition of the word supplement: to supplement a whole food diet. Yes, there's a big market for the food-plus supplement space of meal replacements or nutritional snacks, but we've got to be really careful that that doesn't create the optics that these are meals and this is what you can eat all the time. Like, protein bars are rad, you just shouldn't eat it for every meal. AG1 is amazing, it does not replace eating fermented foods and whole foods and salads, right? It helps for the gaps. And so that is the reason this whole industry exists, and it will likely continue to grow in demand, which then creates the opportunity for incredible high-quality players in the space like AG1 and some of the great brands that are here, and some less scrupulous players that are taking advantage, and that is muddying the category meaningfully. And it's not a category that's exactly at the top of the trust tree to begin with.

So when I joined the company three years ago, we were just, you know, growing at 200, 300% on top of hundreds of millions in annual revenue, and that was just pure demand, accelerated by COVID, but further accelerated by the fact that it's just a high-quality product. So people were drinking it every day and recommending it to their friends. So friends and family is our number one growth driver — number one, just personal recommendation. Number two is organic search. Then number three — a lot of people think it's number one — is the creator, influencer world, but it's actually quite far down the list. It's a low double-digit percentage of driver for demand. And so this was the tailwind that I inherited. I call it type one fun: when you join a company that's experiencing that, it's like, 'Woo, hands in the air,' type one fun.

What we're doing now, at, you know, projecting over $600 million in this fiscal year, is type two fun. It takes a lot more investment, it's a lot harder, it's not always fun day to day, but it's much more rewarding. And what I recognized when I joined the company is we had this incredible quality story — NSF Certified for Sport, which, by the way, I haven't seen one of our critics that has their own products that is NSF for Sport certified. And so bringing in third parties to say what is on the label is what's in this product; two, it is safe for professional athletes. That is a badge that says it is WADA-compliant and they can drink it and not be blacklisted for banned substances.

So it's a quality mark, the only third party that we use, but it's a big one, and there's a reason companies don't use it. It's expensive. Every time you change the formula, you've got to go back through all of the label-claim trials. We didn't start with it, but we've had it consistently for, I believe, eight years now. Then it was clear to me that supplements were starting to get judged against some of the pharmaceutical standards in the industry from a research and clinical perspective. We didn't care about it before. Doctors told us to take a multivitamin, sometimes a probiotic, maybe vitamin, maybe omegas, and we're like, 'Great, I'll take it.' But if you test those products, you might see that what's on the label degrades over time depending on the shelf life. Probably true for 80% of the products that are out there, if they don't properly manage both the shelf life, the quality, and the overages like we do, which NSF for Sport requires. But the question that started to really come up in the space is — there were so many options — is how do I know it works? There's a safety question: can I trust it, is it safe, so what does it have not in it. And then there is a 'how do I know it works,' because we're all smart consumers and we're being marketed to heavily. I don't want to put something in my body and pay for it if it's not going to do anything, if it's just expensive pee, which is what we've heard about the vitamin business.

Enter a wave of brands — not many of us, but a few very premium brands — investing in double-blind, placebo-controlled, randomized human trials. We already have one out in the world; we have multiple more about to be released, in addition to in-vitro studies and other types of research that prove the efficacy. And it's funny when people say, like, 'Oh, are you doing this now because you have critics?' I saw some — you got a lot of critics that came out earlier this year. Do you know how long human trials take to pull together, to recruit, to run, to interpret? That's even before it's published. Years. I have had these trials going on for years, because we knew it was the right thing to do. It took a year to build a team of PhDs, it took a year to scope the third parties and institutions that would run the research, then it took a year to actually recruit and conduct the research. And only now am I able to start communicating.

And so the marketing strategy is shifting from 'everybody already wants it, so just click here to buy AG1' — like every podcaster has a slash, you know, 'drink AG1 slash link' and an offer for you, because there was so much demand, people needed it, they wanted it, and they trusted it, or they trusted those who trusted it. It's a different game now. A lot of what we've been doing for eight years, we're now actually starting to market. Some of you may have seen New York Times, Wall Street Journal creative that said 'Tested for those who test themselves: you should listen to your gut, but no one else should have to,' and then linking the gut health research that we have. So we're marketing the science more without losing our humanity and our brand affinity, investing tens of millions of dollars to do this. So it's hard, it takes a long time for it to come out, it's expensive, but it is going to be the way of the world in the supplement space, because it's so crowded. How else do you know?

AI is definitely making its way through the business. So we start with the obvious places, where the CFOs, like, love it, no questions, which is customer service and customer happiness. We're a proud partner of Sierra AI; they've been a phenomenal partner to us to bring actually a more personalized experience to the entire customer journey. Saves money, improves the experience, allows us to redeploy those funds in loyalty programs and customer retention programs. Then we are starting to apply AI to our research and innovation, so substantiating claims, innovating interactions between ingredients. There's 75 ingredients in AG1. We know things that even a lot of like researched institutions don't know, because no one else is combining that many vitamins, minerals, and whole foods to know how they interact, what they do for each other, their synergy and their impact on taste and texture. So we will eventually build our own AI that is a knowledge base that we could deploy for our own innovation or in service of the industry. And then, of course, AI through traceability and supply chain. We own our sourcing all the way to the farm, and we're using AI to power our traceability.

Love this question. So the question is, why is it not wholly certified organic? There are many ingredients in AG1 that are certified organic when they can be, but organic doesn't mean free from heavy metals. Organic doesn't mean free from other things that are very dangerous, especially for a product that's daily consumption. So when we can source organic that also meets our insanely strict standards on heavy metals, we get organic. When we cannot, we still test for over 500 pesticides and herbicides. So we give the customer what organic says the customer wants, and we ensure it is much safer for daily consumption.

So if you ever want to scare yourself, go test organic vegetables for heavy metals from any grocery store. And it's in our soil, right? It's everywhere. You can't avoid it, unless you're in a very small farm where — which there's a huge 'eat local,' right? Whenever you can. A small farmer, you know the soil. So when we're making a product that is full of incredible fruits and vegetables, I'm going to make sure it's free of herbicides, pesticides, including glyphosate and its derivatives, with a COA published on our site so you can see it anytime and see all of those levels. So transparency and visibility. But I'm not going to create a product that I wouldn't want my mom to drink every day, just because it gives me the badge of organic on the bag. And so it's this, like, having the highest standard — but you know what's hard? It's hard to communicate that in a marketing snippet, very hard. And so I'll see these comparison ads or creators who are like, 'I'm drinking this because it's all organic,' and I'm like, 'Go test it for heavy metals, girl.' And so it is tough to have the highest standard, because it will not always be appreciated by the critics, and in fact those very high standards will be used as marketing ploys by other people who...

have their own products that are not third-party certified, that are not tested in the way that ours are, but such is the way of the world, right? Abundance—we can all show up in the world, but we're going to keep pushing the standard for quality. And I welcome anyone who challenges the industry to do more and better. And we're going to be a part of that. Just because we're one of the best now, we'll do more next year, and we'll do more in the following year. You know, I only have one double-blind, placebo-controlled human trial out now. I've got four more coming, and it will continue to push the standard forward.