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60-second interview, Alex Karsos, co-founder, GI Nutrition

How easy is it to break into the sports nutrition market?

14-Feb-2012

Related topics: Dairy-based ingredients, Proteins, peptides, amino acids, Energy, Sports nutrition, Markets, Manufacturer insights

There is room in the sports nutrition market for innovative new players, but being a minnow in a pond full of sharks is not easy, Alex Karsos, co-founder of New Jersey-based start-up GI (Grecian Ideal) Nutrition, tells Elaine Watson

What gave you the confidence to try and start a business in such a competitive market?

My brother Chris and I started thinking about setting up this business at college. We both went to Babson College in Boston, which is the top college in the country for entrepreneurship, so we were already plugged into a whole series of contacts from trainers and athletes to nutritionists and doctors by the time we graduated in 2009, which really helped start the business.

I played baseball and we were both heavily into nutrition, which really opened our eyes to issues around steroids and adulteration, but also alerted us to the kind of marketing gimmicks used by sports nutrition companies.

We thought there had to be room in the market for someone selling nutritional products that everyone from parents to professional athletes could trust, with no banned substances and avoiding artificial ingredients where at all possible.

We knew it was a very competitive industry but we believed we could find our niche within an already established market.

How did you get your foot in the door?

We partnered up with NSF Certified for Sport, which gave us a real focus. It narrowed down the number of manufacturers we could approach to make our products, because they have to be certified. But it has really helped us stand out in the market, which is dominated by very big players like EAS that have marketing budgets bigger than anything we could possibly imagine.

We started by selling our products via training facilities that work with athletes and via our website before approaching the big retailers.

But now that we have a loyal following and we understand the market better, we are starting to talk to some of the larger e-commerce and bricks and mortar retailers.

With some, the conversation we’re having is via a broker, but with others, we’re talking to the buyer direct.

It’s tough to get your foot in the door but buyers really value NSF certification and the fact we have serious athletes that are using and endorsing our products – and we’re not paying them to do it!

What is in your product range and what is planned on the new product development front?

We’ve got four products in our core range: Ideal Pump (pre-workout), Ideal Recovery (post-workout), Ideal Whey (rBGH-free whey protein sweetened with stevia), and Focus Food (protein bar). We’re also launching a multivitamin and an omega-3 fish oil.

What do you make of the current row over DMAA (1,3-Dimethylamylamine)?

We stayed away from DMAA from day one. Aside from the questions about where it comes from and safety concerns following the recall from military bases, it’s going to make you fail a drugs test, so we just wouldn’t use it.

When do you anticipate turning a profit?

We hope to be profitable by the end of this year. We’re also looking at bringing in outside investors, either angel investors or venture capital funds.

What are the biggest challenges you have faced trying to get your business off the ground?

One of the biggest issues now is the cost of whey, which has gone up a huge amount in the past couple of years, but the hardest thing is time management, just trying to fit everything in. When you start a business you have to do everything yourself, from chasing down sales leads to dealing with our manufacturers to updating the website – there is still so much to do.

What’s the best thing about it?

Obviously we want to make money, but to be able to go into a store and see someone pick your product off the shelf – that’s what it’s all about.