Nightfood Holdings Inc (NGTF)

[notshakenorstirred]

New Year's update...from $NGTF CEO...Sean Folkson 12/30/21

Most likely the last message of 2021 here guys. and it’s a long one:


when you’re creating something new and bringing to market, you can either be early, late, or right on time.

the only way to know is to launch. We thought we’d be right on time. I thought we’d put “nighttime ice cream” on the shelf and people would be fighting in the freezer aisles to get the last pint.

Now, with more information, it’s clear we were early. So, the market needs to be brought forward. It’s possible that could be done through the crowded supermarket vertical with tens of millions of dollars (or more), or through alternate means.

Nick’s was in 4,500 US stores and did about $4M in US revenue last year. they raised $130 million in 2021. it’s expensive.

Had our timing been better, we’d have been able to grow faster and more efficiently, and probably kept supermarkets as our main path.

With new information, and aggressive interest from one of the largest hotel chains in the world regarding rolling out into many of their largest banners representing thousands of hotel locations in the US, we believe a pivot to using hotels as our launchpad makes the most sense.

“Mistakes” like these happen all the time to those in the arena. And while the announcers are second-guessing, and the fans are booing, the quarterback and coach are there on the sidelines looking at the tablet and figuring out which adjustments to make in order to win the game.

We always thought the hotels would be a complimentary vertical, and we were very public about that for years. I remember in the winter of 2010 lugging a backpack full of Nightfood bars to hotels all around Manhattan.

I invested thousands to attend the BLLA trade show in San Francisco in January of 2011 to try to secure hotel partnerships. it was too early and hotels were largely not taking their grab & go seriously. we tried to sell direct to the hotels as an amenity, it didn’t connect.

like Thomas Edison and Harlan Sanders and others, I kept plowing forward, eyes on my vision and the goal, not the “mistakes” made along the way

And one could certainly argue “hey, you’ve been wrong (or early) before, what makes you think the hotels will suddenly be magic?”

But we’ve seen the results of the test, and we’ve been provided projections based on the test results. This is not a supermarket environment with tons of competition and cutthroat price wars.

The hotel environment allows us to have product placement with context. Like the vending machine at the rental car pickup location on my trip that ONLY sold cigarette lighter adapters for USB phone chargers. Put that vending machine pretty much anywhere else in the world and it’s a bust. Put it in a rental car office and you’ve got a great offering.

Our goals have been stated previously…here they are again:

• launch into our first national hotel chain this winter, bringing national vistar distribution
• add additional chains throughout the first half of 2022
• Secure distribution in 7,500 U.S. hotel properties by summer
• be in ostensibly “all 20,000” of our hotel target properties by end of 2023, with multiple snack formats
* ice cream pints
* ice cream novelties
* cookies
* chips
* candy
* nutrition bars
• generate $10+ of revenue per hotel property per day
• leverage our hotel distribution to:
* support supermarket growth in terms of
* same store velocities
* additional points of distribution
* Accelerate consumer adoption of the category. Specifically, using the de facto endorsement by the largest hotel companies in the world to help people accept and internalize the belief that what they snack on before bed matters
* serve as an economic moat around our brand so that when the category does develop, we have an even greater advantage and head-start over the global CPG giants than we could ever generate strictly from supermarket and other traditional distribution.

Profitability projects to come around 4,000 hotel properties.

Quote above from Nightfood SM site.