By Gracen Kostelecky, ISU Pappajohn Center for Entrepreneurship
This story is part of a series featuring each of the fifteen startups in the CYstarters 2018 summer cohort. Each team has the opportunity to focus on their startup or business idea while receiving $6,500 or up to $13,000, along with mentorship, accountability, and educational sessions on how to build a business
Hanstad shared his business, DeadEye BBQ Food Products, to community supporters at the CYstarters’ Community 2018 Kick-Off event held at ISU Research Park, Core Facility on May 23, 2018.
Michael Hanstad
Age: 22
School: Iowa State University, bachelor’s degree in marketing
Hometown: Johnston, Iowa
Facebook, Dell, and DeadEye BBQ. What do all three of these companies have in common? They all started out of a dorm room on a university campus. Although DeadEye BBQ might not be the household name of the multibillion dollar companies that Mark Zuckerberg and Michael Dell started, Michael Hanstad and Tyler DeVoss, cofounders of DeadEye BBQ Food Products, are well on their way to another dorm room startup success story.
During their freshman year, Michael Hanstad and Tyler DeVoss met in the Willow Hall residence facility. Both had an entrepreneurial mindset, wanted to start a business, but did not know where to start. One day, DeVoss mentioned that his family had an incredible barbeque sauce recipe that Michael had to try. Michael fell in love with it, and they both decided this was going to be their first business, selling barbeque sauce. They spent one summer traveling the state of Iowa and selling at small farmers markets, gaining product validation. The next fall, with the help of their former management professor, John Walker, they landed a meeting with the Marshalltown Fareway store manager, and made their first large grocer sale. They haven’t looked back.
Where can you buy DeadEye BBQ Sauce?
We are in about 100 grocery stores all over Iowa and a few in Omaha. We are currently in HyVee and Fareway stores, along with selling online on our website and Amazon.com.
How does DeadEye BBQ differentiate from every other bottle on the shelf?
We use the highest quality ingredients on the market, which makes our sauce a premium product. We are priced slightly higher than some of our competitors, but we feel that the ingredients, along with our small batch bottling process, makes a more consistent sauce that is worth the price.
Who is your target market?
When we first launched DeadEye BBQ, we were targeting middle-aged men and women in small town Iowa. We have since pivoted to targeting millennial hybrids (age 28 to 42) because no one in the BBQ industry was targeting them.
What challenges have you faced?
We grew too fast, too early. During our sophomore year in college, we got into Fareway’s corporate distribution, which meant we had our product in over 130 stores. We thought we ‘made it’, but our sales were not where they should have been. We did not have a personal relationship with these stores, so our sauce was placed in the wrong department of the store. We eventually left Fareway’s corporate distribution, and now sell to the individual stores. By creating personal relationships with the managers, our sales have increased because of our efforts.
About a year ago, our sales had plateaued and we weren’t seeing any growth. We decided we needed to make a change. A new logo and bottle labels help differentiate ourselves. Previously, our bottle had an old western theme label, but so does every other barbeque sauce. We decided to put our faces on the label (literally) and change from glass to plastic bottles to help with distribution costs. Our sales have seen significant growth since the label change.
What was your favorite part of CYstarters?
The 18 other members of CYstarters were extremely beneficial. Everyone comes from different backgrounds and has different experiences. All of the cohort members are open to listening to new ideas and brain storming with little judgement, no matter how wild of an idea.
How has Iowa State University helped you as an entrepreneur?
Iowa State University has so many resources for entrepreneurs. My former professor, John Walker (now teaching entrepreneurship at Simpson College) helped Tyler and I from the beginning. Judi Eyles, director of the ISU Pappajohn Center for Entrepreneurship, helped us get involved with competitions and prepared us for “pitch offs”, which lead to us winning the National Collegiate Entrepreneur’s Organization (CEO) Pitch Competition, and qualifying for the Future Founders competition in Chicago. We recently participated in the ISU Startup Factory, while also in CYstarters. There are so many resources here, it is incredible.
Hanstad and DeVoss at the National CEO Conference after winning the $5,000 first place prize in the Elevator Global CEO Pitch Competition.
Advice for aspiring Iowa State entrepreneurs?
Utilize your community. We learned that the hard way, because we wanted to do everything on our own, and didn’t get very far. We then met Judi Eyles, who helped us get connected within the university, but also in the entrepreneurial community in Ames. We were able to share our story, ask for help, and improve and grow our business.
What are your goals going forward?
We are going to launch a new sauce in the next few weeks. We will do some user testing at the upcoming Des Moines Farmers Market. If the new flavor goes over well, that will open up doors to continue to add new flavors to our product line, and allows us to get in to new grocery chains.
How can others help you?
If you have never tried our barbeque sauce, go pick up a bottle. Love our sauce, and it is not in your local grocery store? Ask your manager to carry DeadEye BBQ.
Any connections with food distributers you think DeadEye BBQ might do well in, please let us know!
How should others find and connect with you?
You can find us at deadeyebbq.com, on our Facebook, Twitter, and Instagram pages, and you can email us at deadeyebbq@gmail.com.
