If you’ve browsed the chip aisle of your local grocery store in the past year or two, you’ve likely seen Siete tortillas & tortilla chips.
The popular brand is relatively new to the scene, yet it’s slowly reinventing the way people think about Mexican-American food. Instead of wheat or corn, the tortilla chips are grain-free. They are made with natural alternatives, such as almonds and chickpeas.
Despite the massive popularity of Siete Family Foods, the company is still a family-owned and operated business.
The Garzas are the family behind the brand, led by siblings Miguel and Veronica. They recently obtained $90 million in funding and appear ready to take over the natural foods industry.
So, how did a Mexican-American family launch the fastest-growing company in the natural food industry? Here’s the story of entrepreneurs Miguel and Veronica Garza – the founders of Siete Family Foods.
Who Are Miguel and Veronica Garza?
Miguel and Veronica come from a large Mexican-American family, with three other siblings, caring parents, and many extended family members in the Laredo, Texas area.
As with many other Mexican-American families, tortillas were a big part of their diet. Tortillas are traditionally made with wheat or corn flour, which poses a problem for some people. If you follow the Paleo diet or a low-carb diet, tortillas and chips are off limits. Grains are also a problem for those that suffer from lupus.
In 2004, Veronica was diagnosed with lupus and it was hard to start cutting all grains out of her diet, which included tortillas. In solidarity, the rest of the family gave up their staple food. They also started exercising in the family’s backyard and opened a CrossFit gym.
After about six years of grain-free living, Veronica missed eating the foods she grew up on. So, she started experimenting with grain-free tortilla recipes.
She eventually developed an almond-based tortilla that worked as a suitable alternative to corn-based and wheat-based tortillas. The Garza family could finally enjoy tacos and fajitas again!
The Garza Family Has Business Experience
While Miguel and Veronica would go on to revolutionize the tortilla market, Siete Family Foods was not their first business venture.
In fact, Miguel and Veronica have backgrounds in the business world. Veronica has an MBA and worked as an instructor at Texas A&M International University in Laredo. Miguel worked as a lawyer and was currently focused on business development for a healthcare startup in Austin.
The brother and sister also ran a gym in their local area. Working at the family gym taught the siblings how to function as a successful team. Miguel credits the following with helping them thrive:
Miguel knew that his family worked well together. He also recognized that Veronica’s tortillas could provide another business opportunity.
Creating an Alternative to Wheat Tortillas
Developing a substitute for a popular food or ingredient is never easy. If you look at the Impossible Burger and Beyond Meat, it’s possible to create a food that somewhat resembles the real thing. However, it rarely captures the authentic taste of the original food.
With her almond-based tortilla recipe, Veronica had created something that works as a direct replacement for wheat tortillas. Most people can hardly tell the difference between a Siete almond-based tortilla and a wheat tortilla.
Veronica knew that she had created the perfect alternative when her grandmother complicated the recipe. Her grandmother claimed it tasted better than the traditional flour tortillas that she had made for decades.
At first, Veronica was reluctant to share her tortillas with the world. She wasn’t sure how to run a business in the food industry or where to start.
The Garzas Launch Garza Food Ventures LLC
After four years of nagging, Veronica finally agreed to try selling her original almond-based tortilla. The brother-sister duo launched Garza Food Ventures LLC in 2014.
The Garza family funded the venture themselves. Miguel acted as the CEO while Veronica became the president and chief innovation officer. The siblings knew they had a quality product but didn’t know where to start. They first visited a natural foods coop in Austin, bringing samples of their almond-based tortillas in Ziploc bags.
A buyer liked what he tasted and gave the siblings some important advice. He explained how to find a suitable commercial kitchen, obtain liability insurance, and other essential steps in launching a new business in the food industry.
The entire family got involved. Veronica and her parents traveled from Laredo to Austin, a three-hour commute, to make the tortillas each day.
Rebranding and Wider Distribution Help Siete Take Off
One of the biggest challenges that entrepreneurs face is distribution. Getting a product onto store shelves is incredibly helpful, especially in the food industry.
In February of 2015, the Garzas achieved this goal. They got a Whole Foods store to carry their almond-based tortillas. The product was a hit. However, the Garzas had grander ambitions.
The family realized that their almond tortillas and “Must B Nutty” brand limited their potential. If they wanted to reach more consumers and capture a larger share of the market, they needed to rebrand.
They chose the name “Siete Family Foods.”
Siete is Spanish for “seven,” which is a reference to the size of the Garza clan – five siblings and their parents. Miguel and Veronica Garza took their family business to the next level after rebranding.
By the summer of 2016, just two years after launching their business venture, the Garza family had gotten its tortillas onto the store shelves of more than 400 retailers around the country.
In 2017, Whole Foods recognized Siete Family Foods for producing the best new product of the year. While the company was starting to reach more consumers and test other products, growth was still limited. If they wanted to expand, they needed capital.
Raising Funds to Grow the Family Business
In 2015, a year after launching the company, Siete Family Foods obtained $1 million from investors during a round of fundraising. The family didn’t like the idea of giving up ownership of their company. They very much wanted to remain in charge, so they limited their dependency on outside investors.
The business has mostly been supported by the family. A year after launching the company, Siete Family Foods obtained $1 million from investors during a round of fundraising. They only raised the capital to cover the cost of production equipment.
The next round of fundraising came in 2019, in the hopes of financing the company’s growth.
At this point, Siete tortillas were available in over 8,000 stores across the country, but the Garzas still wanted to expand. They wanted to start releasing new products, such as taco seasoning and various gluten-free alternatives to Mexican-American staples.
So, to fund their growth, the company found an investor – the Stripes Group.
The Stripes Group is an investment firm that focuses on the grocery industry. They previously backed Grubhub, which is now worth over $7 billion. The Stripes Group invested $90 million in Siete Family Foods for a minority stake in the company.
Thanks to the investment from the Stripes Group, Siete Family Foods was on track to reach over 13,300 stores by the end of 2019. You can now find Siete tortillas and grain-free foods at Whole Foods, Walmart, Target, and Kroger.
The Garza family has successfully penetrated the US grocery market. What comes next after reaching their distribution goals? Diversification.
Expanding the Product Line to Produce More Sales
With Siete firmly established in the grocery industry, they found that the best way to increase sales was to increase its product line.
In 2019 and the first half of 2020, Siete Family Foods introduced a variety of new products, including grain-free dip chips, enchilada sauces, and taco seasoning.
Along with different product categories, the company offers a variety of grain-free tortillas. You can get natural tortillas made from chickpea, cashew flour, or cassava.
The investment from the Stripes Group is also helping to expand internal operations, such as marketing and research.
Before the investment, the company had just one employee devoted to sales and one employee (Veronica) devoted to research and development. They now plan on adding several new sales employees and hiring new research and development staff.
What Makes Siete Family Foods a Successful Business?
Most successful business stories revolve around a quality product that fills a specific need. Whether it’s organic haircare products or eco-friendly shoes, entrepreneurs can stand out by meeting the needs of consumers.
The Garza family managed to create a great-tasting tortilla that appeals to the gluten-free crowd and anyone else who needs to avoid grains. They produce a quality product that people need and want.
A large part of their success also comes from the size of their operations. They remain a small family-run business. Miguel is still the CEO. Four out of five of the siblings, along with their parents, are still involved.
Having a small, close-knit team allows Siete Family Foods to operate efficiently. However, they are poised to become a permanent fixture in the chip aisle.
As the popularity of Siete tortillas grows, it will be interesting to see what the Garza family plans next.
Feature photo credit: https://www.forbes.com