How a Small Gelato Business is Driving Huge Sales (by Being Anything but Vanilla)

The theme of TGIM this episode is how to be bigger, braver, and bolder, and there's perhaps no better example than an upstart gelato company in Toronto called Death In Venice.

The company has earned rave reviews from foodie bloggers and restaurant critics alike.

So how does a gelato company act big, brave, and bold?

By designing gelato flavors no one else in the world has thought of yet.

Anyone care for a scoop of Thai Peanut Soy Fish, a cup of Chocolate Crisp Cricket or perhaps a cone of Mealworm?

In this TGIM short, you'll...

  • Discover the importance of not only finding a niche, but aggressively capitalizing on it. 
  • Learn lessons about scaling your business and why buzz can't last forever.
  • Find out how subscription models can work for more than razors and wine.

Check out the full short below:

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Speaker 1: So we have carrot, ginger, and [inaudible]. My name is Kio Gruce, I am the owner of Death in Venice Gelato Company. I'll give you a taste of my coconut.

Speaker 2: Kio is a chemical engineer turned chef. Something of a mad scientist in the kitchen, turning out unusual Gelato flavors.

Speaker 1: Pineapple rum ...

Speaker 2: Consider mustard boozie pear and walnut. Or caramelized eggplant and Tahini. It's basically babaganoosh in a cone, but it's divine.

Speaker 1: Add a bit of sugar, bit of milk and bit of cream in something, the chance there will taste good. Just kinda think something nice, you can think of a dish, think of an experience. I have a Thai flavored gelato, it has fish sauce in it, it has soy sauce in it, it reminds me of the time that I did backpacking.

Speaker 2: After traveling for pleasure, and working in Michelin starred restaurants across the world, Kio wanted to start his own business. A motorcycle trip with his girlfriend across Sicily provided the inspiration.

Speaker 1: So we were having gelato at the top Mount Edna in Sicily, like a perfect moment. Weather is beautiful, you're in Sicily, you're having pistachio gelato, it just seemed like a perfect moment that could be replicated in another country.

Speaker 2: Selling gelato in Toronto, a city known for its frigid winters, would his passion translate into sales? Kio knew he was taking a risk, so he started small. He kept his day job as an executive chef, and he rented space in the back of a Turkish bakery and café.

Speaker 1: We didn't set up to be a mega shop. Every time we got a different contract we bought a different equipment. First I was making everything by hand mixing, and it came to a point it was too much, I bought a batch pasteurizer, which is like 30,000 dollars. You can say it's a little bit too conscious and not adventurous, but I already took enough risks with my business model in terms of selling gelato in Canada and doing something quite different, I didn't feel like we also should take a risk in your business model as well so we're quite conservative where we spend our money.
This is a brand new kitchen, we have everything pretty much bought firsthand so there is not a lot of maintenance issues which is fantastic. If you walk towards the corner, that's where my office is.

Speaker 2: It's been money well spent he says, showing off the gleaming brand spanking new machinery in the back of the cafe's kitchen. Kio was also looking for another long term relationship, with his customers. How could he keep them coming back for more gelato, especially during the bitterly cold winter season? Well, if the customers don't come to you, you go to the customer.

Speaker 1: I was analyzing some data, do people eat ice cream or gelato in the winter time, what happens? The data show that people are actually buying a lot of ice cream or Gelato, but when they're buying this it's basically when they're exiting the grocery store on their way out. Nobody walks to a ice cream shop at minus 18, like I'll get a scoop, that's not realistic. So we said, why don't we actually bring Gelato to people's home, rather that them buying a crappy brand because it's just convenient.

Speaker 2: Just like that, a gelato subscription model was born. It's a strategy being used today to sell everything from razor blades and organic soap bars, to more traditional products, like newspapers and magazines, by companies who understand the huge upside to locking consumers into a business. The goal was not to charge a delivery fee, to make it worthwhile for him and the customer, the math worked out to four pints of gelato to your door for 40 dollars a month. Kio also started supplying high end retail stores and focusing on catering.

Speaker 1: Basically I took the business outside more than inside.

Speaker 2: Kio found another way to cut costs but maintain the premium quality of his gelato. He contacted farmers to buy their second grade [inaudible] use, the stuff that's perfectly fine to eat, but doesn't look good enough to sit on store shelves. Now he knows the way to make serious profit is to mechanize the process and supply large grocery chains. But then, he'll be stuck making strawberry and vanilla gelato.

Speaker 1: Life is too short to eat the vanilla and strawberry gelato. I cannot make my chocolate mole or hay gelato, roasted eggplant, and make one million of them and sell it to grocery stores. Nobody would buy it, so I'm not planning to go that route, so I'm not buying those mass producing machines to create millions of things because I just don't want to do it. There's a difference between buying 20 kilograms of sugar, than 5 tons of sugar. There's not a lot of trickery that goes into my product, on it's own it become premium just because of the things I buy.

Speaker 2: There's a lot of buzz around Death in Venice gelato right now. The unusual flavors have food critics raving and food bloggers flooding their Instagram feed with photos of their indulgences. Kio knows the novelty will soon wear off, this is why his retail partnerships are important. They give him room to expand his business and allow him to play the mad scientist in the kitchen, coming up with new flavor ideas to keep his customers coming back.

Speaker 1: You have to carve a little piece out, but then you have to grow because somebody else might come in and take the little thing that you carved before, but at least you have something more to look to. I almost feel like it's essential to grow to stay alive.

Speaker 2: One day, Kio hopes to have his own store, where he can scoop out gelato for his customers and interact with them.

Speaker 1: It's a bit of shifting I think. We're always hungry for this feedback from the customers. We always watch people eat, do they like it? Is it too much salt not little? I like that.

Speaker 2: Death in Venice gelato started off as a whimsical idea, trying to recreate the experience of eating Pistachio gelato on the Sicilian mountain top in Toronto. The whimsy continued on in the unexpected range of flavors but his business strategy is much more cautious; investing money into the business as demand grew, offering a subscription model to bring gelato to his customers' doorstep, and striking strategic retail partnerships. He also understands the hustle; pushing his seemingly savory gelato at foodie events across the city and in doing so, Kio Gruce as scooped out a niche for Death in Venice Gelato.

Speaker 1: [inaudible] white chocolate. Organic cane sugar. Yeah, [inaudible] and a bit of cashews in there, toasted cashews, so it's not overly sweet, and I also salt the white chocolate a little bit so I'm kind on the fence with white chocolate, if it's salted, it's okay, if it's not salted, not really. [inaudible]

Speaker 2: Ciao Bella, I oughta try me some of that gelato.

About TGIM: TGIM is a podcast for people who can’t wait for the week to start. In each episode we’ll be bringing you inspirational stories about entrepreneurs who have overcome obstacles, built incredible businesses, and are now living the life they want.