Rahal, 31, is CEO of
RxBar, now a Kellogg
EXIT INTERVIEW Raising the Bar
Peter Rahal started RxBar, a protein-bar
company known for its sleek, minimalist
packaging, in 2012. Five years later, he
and co-founder Jared Smith sold their
startup to Kellogg for $600 million.
By Danielle Sacks
Why did you start a food business?
My father’s family is in the juice-concentrate business and my mother’s
is in juice manufacturing. Both sides
are Lebanese, and my parents were set
up at my uncle’s funeral. I tried to get a
job in the family business, but for internal political reasons, it wasn’t a good
time. In 2012, I read that it cost only
$10,000 to start a nutrition-bar com-
pany—any dumbass can make a bar.
The category was so competitive in
places like Whole Foods, but CrossFits
were getting popular, so we sold it to
gyms and directly online. Jared and I
each put in $5,000 and thought it
could be a $10 million business. Last
year, net revenue hit $131 million.
Why did you decide to sell?
We never planned on exiting.
Then, around January 2017, potential buyers started asking us
to meet. That stimulated a conversation between Jared and me
about what we wanted RxBar to
be when it grew up. Ultimately,
there are two paths to take: being
a family business and keeping it
private for generations; or going public or rolling into a great
organization. I had experience in
nepotism—family businesses are
complicated. They’re subjective.
We wanted to be objective and
maximize the potential of the
brand. So we chose the path of
finding a partner that was cultur- ally similar and had the muscle
to accelerate our growth.
How did you find the right buyer?
interest from 10
companies and met
with four. We knew
what we didn’t want.
We have an allergic reaction to private
equity: They’re not
operators. They’d want
to maximize profit
and go public. We
also didn’t want to sell
a portion of the com- pany and then have
to sell part of it again.
We wanted to do a
100 percent sale,
because the process
takes a shitload of
time. We first met
with Kellogg in March, and it didn’t close
You’re still running
RxBar, but now within
this huge corporation.
How do you make
sure you don’t get
The number one way to
protect RxBar is for us
to earn it. If we over-
deliver, we’ve earned that.
But if we underdeliver
and go south, then we’ll
need to change. If you
have a kid in school
who’s doing well, with
friends and playing
sports, you wouldn’t
change schools. But if
the kid starts hanging
out with a bad crowd
and smoking pot, you’re
going to change his
school. We need to be
a good student.