Idaho has long been known as a manufacturer of computer chips. Now, Kyle Nehring wants it to be known as a manufacturer of potato chips as well.
Getting the idea
Nehring, founder and CEO, first got the idea for Teton Valley Brands when he was going to school at Brigham Young University – Idaho in 2010. “At the time, I was literally a broke college student, and I didn’t know anything about consumer packaged goods,” he said. “I was studying entrepreneurship, but I didn’t know a ton.”
But then in 2015 Nehring started working in logistics and purchasing for a 50-employee plant-based protein supplement company, which went on to bring its manufacturing in-house. “It was the perfect size company to get an overall view,” he said. “It gave me the confidence to see what I could do with this idea.”
The company was formed in 2017 with Nehring, his brother, and his brother’s wife, and for a time they operated it as a side hustle out of the basement, he said. In 2019, they relocated to Nampa, started building the company out and he went full-time. In mid-2020, the company started producing its own potato chips.
And why Teton Valley Brands, if the company is based in Nampa? That’s a nod to his family, Nehring said. “My great-great-grandfather’s farm is in Newdale,” he said. “Even if you’re from eastern Idaho, you might not know it – it’s only 200 people. But it’s within reach of the Teton Valley and you can see the Grand Tetons from his farm. That’s where it sprang from.”
Idaho potato chips
So what makes Teton Valley Brands potato chips different from other potato chips? “The obvious answer is that they’re made from Idaho potatoes,” Nehring said. While Idaho produces about a third of the potatoes used in the United States, Idaho’s climate means it gets only one crop rotation a year, meaning they need to be stored for longer.
“Potato supply is the hardest part of this company,” Nehring said. “The potato is a living organism throughout the year.” How the potato is stored affects factors such as its sugar content. Consequently, some potato chips manufacturers use potatoes from Florida or California during certain times of the year, because they can harvest potatoes earlier, he explained.
The other aspect is that the classic “Idaho potato” is a russet type, which is best for baking. But Idaho farmers do grow up to 20 varieties of “chipping” potatoes, Nehring said.
Other ingredients are regional as well. The sunflower oil comes from Colorado, and the salt – the only pink salt mined in North America — comes from Utah, Nehring said. They have no preservatives and consequently a relatively short shelf life.
In addition, Teton Valley Brands leaves the skin on the potatoes. “It has more color, more nutrients, and tastes better,” Nehring said.
Nutrients? Potato chips have nutrients?
“It’s a terrible misnomer,” Nehring said, noting how potato chips are usually pretty high on the list of naughty processed foods. “Potato chips are one of the most natural products. You’re taking a potato, which is a living plant organism, seed oil, and all you’re doing is cutting it and cooking it in oil, tossing salt on it, and tossing it in a bag.”
That said, Nehring admits that potato chips in general aren’t perfectly healthful and people shouldn’t be eating them nonstop. “I learned that the hard way developing our formulas,” he said.
Planning for Growth
Recently, Teton Valley Brands announced a capital partnership with Cranney Farms, a seven-generation, 20,000-acre Oakley potato grower, to help solve the potato supply chain problem. While Nehring built relationships with farmers and potato storage companies by buying potatoes from market brokers, he had long had the goal of partnering with an Idaho potato farm, he said. “It’s a huge step for us,” he said. “It helps solve one of our biggest challenges: consistent quality and supply, grown for us for this purpose.”
Cranney also provided an unspecified capital investment – for which it received an undisclosed share of the company – which will allow Teton Valley Brands to expand its distribution facility.
“The potato supply was critical, but we wanted to get into a larger footprint and have the capacity to meet what we believe is the demand,” Nehring said. And that’s not just regional, but nationwide, he added. Toward that end, the company is finalizing an agreement to build a facility in the first quarter of 2024 that’s four times as big as its current facility and can produce 500 to 600 pounds of potato chips an hour.
“It’ll really change the way we approach this business,” Nehring said. “This is the next step that solidifies us in our state.”
The exact location wasn’t finalized yet, but it will be in the Treasure Valley, Nehring said, adding that he had looked at properties in Caldwell, Boise, and Merdian.
This also marks the first time that Teton Valley Brands has taken outside investment, having operated on a shoestring before that.
“When we started, my brother and I heard about another consumer packaged goods company for $11,000,” Nehring said. “We wanted to go smaller, so we each put in $5,000. Very quickly, we saw that that was not going to be enough.”
So in 2019, Nehring sold his house – ten days after his wife had given birth. “That basically paid for the company,” he said, though there have been some other investments from friends and family. “And a whole lot of credit cards,” he added. “We tried to find as many zero-interest credit cards as we could, and funded it that way.”
For the first two years, Nehring didn’t draw a salary. “When I did start paying myself, it was pretty meager,” he said. They also put in “sweat equity,” hanging the drywall themselves in their current facility. “To this day, I still do electrical work,” he added.
The distribution challenge
Unlike many consumer packaged good companies, Teton Valley Brands hasn’t had much trouble lining up distributors. For example, when Nehring signed up for the Boise Entrepreneur Week Trailmix food competition in 2020 – where one of the prizes is shelf space in Albertsons – his product was already in the Albertsons Market Street store, he said.
“Albertsons reached out to us, which was kind of cool,” Nehring said. The company was preparing to launch its first Market Street concept store on Broadway in Boise, and was looking for local products, he explained. Then the product became available in a larger number of stores in the Treasure Valley, and is now available in all Albertsons’ in Idaho, he said.
Besides that, Nehring drove around himself to stores to deliver product at first. “Anybody doing this has to fight,” he said. He now has a full-time driver who takes care of local stores, and also partners with several distributors, ranging from small independent ones to larger ones.
Teton Street Brands is even in some Walmart stores. “This region of Walmart is pretty special that way,” Nehring said. “You can be a relatively small company and get in just this region. To someone thinking about founding a company, Walmart sounds intimidating, but it’s a real option.”
Nehring isn’t sure what his exit strategy is yet. “Our focus is to build a legacy company here in Idaho,” he said. “We want it to grow and be something sustainable.” He doesn’t rule out the idea of selling, but the company has to be a certain size, he said. “It’s a conversation we’ll have, but that won’t come for a while,” he said.