In 2018, Daniel Welch made a life-altering decision when—after having spent a decade in investment banking working on high-profile IPOs and M&A deals at Morgan Stanley—he found himself at a crossroads. The birth of his daughter and a health scare involving his father led him to question the career path that he was on. “I was mentally stimulated by the work, but it didn’t align with my personal values,” he now reflects. Burned out and seeking more purpose, he left the corporate finance world to pursue mission-driven opportunities in the health and wellness sector.
Welch’s career pivot first brought him to Sonos, where he helped to lead the company through its IPO. He later transitioned to Oura, maker of the Oura Ring, to end up playing a key role in guiding the firm through a critical growth stage. These experiences solidified his desire to combine financial expertise with personal passion.
Read MoreIn 2023, Welch found his ideal role as CFO of Kate Farms, a company focused on revolutionizing the field of plant-based medical nutrition by providing organic products free of common allergens and designed to improve health outcomes for patients in medical need. Its mission resonated deeply with Welch’s personal health journey, which had begun with his own transition to a plant-based diet.
Backed by investors like Goldman Sachs Asset Management and Novo Holdings, Kate Farms continues to grow its presence in hospitals and home care systems across the U.S., making Welch’s leadership integral to the company’s scaling efforts. His career transformation highlights how purpose and profit can intersect when leadership is guided by personal values.
“Our focus is on gaining leverage on OpEx in order to continue to build a business that is valuable to both shareholders and stakeholders. We need to learn the most efficient use of our resources and be disciplined in the execution of our operations. These are the things that we’re building into our plan for next year and will be successfully implementing this year, always keeping our nose close to the grindstone.” –Daniel Welch, CFO, Kate Farms
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CFOTL: Tell us about Kate Farms … what does this company do, and what are its offerings today?
Welch: Kate Farms is a truly disruptive nutrition company. I realize that the term “disruptive” has been very much overused in the past—especially by people like me who come from a technology background—but what we are doing is really revolutionary in a category that hasn’t seen any innovation ever, basically.
We probably all know someone who has nutritional requirements that just simply can’t be met through normal diet alone, or maybe they’re unable to eat a normal diet. There are millions of folks who are tube-fed. Maybe they’re going through cancer treatment and can’t swallow or ingest normal nutrition or meals. Most often, undernutrition is due to a medical condition—but not always. Sometimes, people’s life circumstances alone can mean that they don’t get enough nutrition, and they become malnourished in some way. Inasmuch as we are in general sort of chronically overnourished in the developed world, we tend to overlook that there are a significant number of people in the United States and globally who are deficient in many aspects of their nutrition.
Read MoreMedical nutrition can actually be life-changing for undernourished people. If they have the right nutrition, oftentimes supplemented by medical nutrition products, they can regain strength. Children who are not on the normal growth curve and/or are falling behind can gain the extra nutrition or calories or protein to catch up. Even more broadly, having high-quality, highly efficient medical nutrition is really essential to lowering the cost of healthcare, as it leads to fewer complications, shorter hospital stays, reduced mortality, and so forth.
Local grocery stores have exploded with health and wellness products over the past several years, but if you go to their pharmacy section and specifically look for medical nutrition, you’ll find that there is a large amount of shelf space dedicated primarily to shakes. Flip over one of these products and look at the ingredients list. You’ll find that corn syrup has a big presence, as well as artificial flavorings and dyes. Almost all of them are formulated using milk-based protein, which—although not necessarily bad in and of itself—is not always well tolerated by everyone. This is especially true for folks who are sort of in a medical-need state.
Perhaps just as important, if not more so, these are more often than not formulated with sort of the cheapest, lowest-quality ingredients—the same types that have found their way into the hyperprocessed foods that are, quite frankly, destroying the health of the developed world. The thing is, we have children and adults, including seniors, in various states of medical need who are relying on these products as their only or primary source of nutrition or as a supplemental source in addition to what they’re eating day-in and day-out.
We’ve seen an explosion of organic, plant-based, “better for you” products basically everywhere else in society, except in this category. There really had been no innovation, until along came Kate Farms, the story of whose origin is interesting as well as fascinating. The family had a daughter with cerebral palsy. She became severely malnourished because she wasn’t able to tolerate the sort of junk that was on the shelf and was being recommended by her pediatrician at the time. Thus, they set out to build a nutritional formula based on very high-quality ingredients and designed for being tolerated.
Kate Farms is really changing this landscape of medical nutrition. Everything we make is organic. It’s plant-based, which means that it’s much more easily digestible. Our products are designed for tolerance. They’re free of most common allergens that are out there. Every product is packed with plant phytonutrients. The majority of our products are nutritionally complete, so they can stand alone as an independent nutrition source. We’ll never make a product that has artificial flavorings or dyes. In fact, we actually have a strawberry-flavored product that surprises: If you pour it into a glass, it’s not red like you would expect, because when you put organic strawberry flavor into a product, it actually oxidizes and the red coloring disappears. So, anytime you see a red strawberry food product, there’s probably been something added to it to make it red, as natural strawberry just doesn’t do that.
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Kate Farms | www.katefarms.com | Santa Barbara, CA