Transcript of From Rock Bottom to 2 Exits and a New Brand Built on Discipline | Ep. 392 with Michael Chernow Founder of Kreatures of Habit

So Michael, it was such a great experience running into you and meeting at Expo West. And you said some things to me that, that stuck with me. I think every entrepreneur at some point will probably have to deal with. You've had success, you exited multiple companies, yet you said you were humble enough to go back to the streets to grinding you had these bars, you were carrying these bars that you make, your company, and you were handing them out to people. And I think there's something so not only humble, but there's something so driven in you that must have made you say, like, I need to do this. What was that?

Human beings, connecting with humans at scale is my inherent superpower. It's what I love to do. I love engaging with humans. And it's, and I think, you know, at the end of the day, right, I do believe that I'm a salesperson, you know, at heart. And so for me, engaging in a conversation with somebody is what ultimately is going to A, fill my cup, but B, give them the best version of whatever it is you're trying to peddle. And right now, you know, I have a company called Creatures of Habit. We make this high protein overnight oatmeal. We make a sleep support, but the most recent product that we've put on the map is the Daily Bar, which is our protein bar. And so like with the other two products, it's hard for me to just like hand out samples because you gotta make them. With this one, I can hand you something, you open it up, you try it, and I have a story behind it. And so I, I just think like one of the hardest things, one of the best forms of marketing, or if not the best form of marketing, is word of mouth.

And when I can be the guy that you received the Alley Bar from first, the founder, and I tell you the story right then and there, like for you, I handed you the bar and you had a camera crew with you. Immediately you turned on the camera, right? Like it's just that I believe that to be. The great, and I also love it. Like I love doing that. Like if that's all I could do, I would. I would stand at events and just hand bars out and get to meet people. You know, I think that that is kind of what really does fill me up and drive me.

Back in the day, I used to work for trade shows. They would hire me to put on those, the booths, and we'd have to do that. And I'll never forget, we did this with Tropicana. And I had the megaphone. We did that at Costco's at roadshows. Have you ever seen those crazy people? It is really exhilarating. And it's not, I mean, it's not for everyone for sure. It's definitely exhausting, but I love it like you, and you have a great personality. You, you were telling me about the time when you hit rock bottom, like this was like rock bottom. You might not even survive. What did you learn from that moment that's carried over to business?

Great, great question. There's only one thing we have to do perfectly in life. Only one. And that's get back up. It's the only thing you got to do. Right? Like, life is going to throw curveballs. You're going to strike out a bunch of times. You're going to lose the fight. You're going to not hit the sales. You are going to not raise the money. You're going to open a business, you're going to close a business. The only thing that I have found for me in my life was to be successful every time is just to get back up on my feet. And, you know, I had a drug addiction for 11 years of my life from 12 to 24, almost just before my 24th birthday. And it, it, it almost took my life and I got really lucky that it didn't. And then 2 weeks later, I asked for help. And that was arguably the best day of my life when I was willing to just stand up on my two feet and say, I need help. And ever since that day, I've understood that it's never too late. It's never too late. Impossible is not a word that I give much energy towards, you know, And, um, outside of the NBA, like, I won't— I, I'll never play in the NBA.

I'm 5'8" and I'm 45 years old. So like, I've tossed that out, but you know, like, I really do believe that the only thing that we have to do perfectly is get back up. And it's, and it's shown to be, uh, accurate, uh, throughout my journey.

I was just seeing that there's somebody who's like 5'7" was just covering LeBron James. I don't know if it was real or AI. but I thought it was fascinating. It looked kind of ridiculous, but hey, I know what you're saying. Like, there's definitely— I will never be in the NBA or really any professional sports. I could never make it. Well, let's go to the feeling. Like you said, you got— you obviously, you don't even think that failure is even an option, even when you're faced with the ultimate worst things. And I think as business owners, every day is like, you know, the cliff is coming off. You're falling off the cliff. Like, literally, you have the best sale ever, and then 5 minutes later, something horribly happens, and your business is like on the verge of breaking down. When you sold your first company, what was the feeling? Bring me back to that moment. I want to understand, like, knowing all this happened, then you built this business and you exited the company. What was the feeling then?

I was 30 31 or 32. I did not go to college. I don't have, like, I'm not good at math. I'm not good at numbers. When I sold my equity at the meatball shop, I saw 7 figures enter my bank account. And it wasn't a monstrous 7-figure, but it was a for starting a company with $20,000, it was a really good return. It was an unbelievable day for me. Now, getting there was really hard, super hard, painful, guttural, you know, like the things that I had to go through to get there.

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But the feeling that I got that day was different than stuff that I've heard from other founders where it's like, oh great, you have this exit and you know, you, you, you fall into a depression. Like I didn't have that feeling at all. I sold the company. I, my life changed pretty quickly. I made it a commitment to myself to not at all allow this to change who I was. I started another business 9 months later. So, you know, I, I, and I, you know, I made one per— I made two purchases, two purchases. I bought my wife and I a house in upstate New York for not a lot of money. Uh, and that's the house that we now live in. So it was a really good, it was a really good purchase. And, um, and I did buy one thing that was kind of goofy. I did buy myself a Rolex. So I bought myself my first Rolex and I, I bought a house, um, in upstate New York and I didn't buy the house outright. Like I put a down payment on it, you know, but, um, yeah, it changed my life.

And, um, you know, I helped my mom out with some cash and, um, told my mom, you know, my mom never had money. So I just said, hey, like, you just won't, you know, I'm going to make better decisions than the decision I just made as I continue to grow my career. And just know that like, you'll be okay for the rest of your life. Like, not that I'm rich by any stretch, but I felt like, you know, especially after my second exit, I was like, you're good. And that made me feel really good.

So that sounds like a smart reinvestment of the money versus like an Italian sports car that is worth zero after you buy it. And I mean, you know, hats off to you talking about helping your mom. And I think that's amazing. I think that's why we do this, right? We don't do this just to make money for ourselves, but we really have, we want to positively impact our family and those around us. You're obviously a creature of habit, not only from The fact your company is called that, but why did, why was Creature of Habit? I'm sure there's more than just a name there. What are habits meaning to you in your life?

I mean, my habits almost, you know, the way I kind of look at it is habits will make us or break us, period, done. That is just the bottom line. The decisions that we make on a daily basis define who we are, period. And the decisions that you make are right now. You don't make decisions today. You can plan for tomorrow, but the decisions that you make are ultimately going to impact you in the moment, right? And specifically the little ones. Am I going to hit snooze or am I going to get out of bed? Am I going to eat the donut or am I going to eat the salad, the kale salad? Am I going to go to the gym or am I going to skip it? Am I going to take the bait when my wife puts, says something that I don't like, or am I just going to take a moment? Give myself a little bit of time to metabolize and not take the bait. Like, these are the decisions that, um, you know, I am trying to help people with. And, uh, and because like I said, like habit is a double-edged sword.

And quite frankly, when people hear the word habit, even till today, like there are, there is a niche group of people that think when they hear the word habit, they think positive. The majority of the people on the planet, when they hear the word habit, they're like, oh, bad habit. Very rarely do you hear people say, man, I've got this incredible habit that you've got to try. More than likely people say, man, I got to kick this habit that I've been, you know, I got to kick this bad habit. So I wanted to really put an emphasis and a highlight on positive habits being the catalyst to happiness and success. And that's my story, right? When I gave up the bad habits and started replacing them with good ones, everything in my life changed. My life has only gone up from the day I got sober in August of 2004. My life has only gotten better. It's just a fact. Like if you, if you, if you look at my life as, as a bar graph prior to August 2nd, 2004, it was, it was like, it was, it was this way. It was, it was all downhill.

August 2nd, 2004 came and it just went like that. And, um, and it's just been better and better and better. And it's because I have made myself a creature of habit in a positive way. And it starts in, this starts the moment I wake up in the morning and I wanted to be able to tell that story. Like you have an opportunity to change your life. And for me, because I'm a food dude, I was in the restaurant business for a long time. Humans' relationship with food is very intimate and a lot of people battle with their relationship to food. So I thought, hey, like if I can create a few habits that are nutritionally focused, I can help people make better decisions with their nutrition, which ultimately in an ideal world will send waves throughout the rest of their day to make better decisions on other things. And that's when I launched the Meal One product, which is, you know, our breakfast product. And, you know, my, my thought process is, and it's panned out, is like, you sh— you shouldn't have to spend too much time thinking about a healthy breakfast. Like, I, you can make it easier.

And, um, and when you eat, you know, a healthy breakfast, you have a better shot at eating a healthy lunch. And if you eat a healthy lunch, your chances of eating a healthy dinner are just better. Not that they're guaranteed, but, you know, like start the— typically the way you start is going to paint a picture of the way you finish. And I always use the metaphor, like, if you're at the horse race, you know, if you're at the races and you're sitting in the stands and you've got your money on True Religion and you're like, you know, they're— the horses are at the gate and they're just like bumping up against the gate and then boom, the gun goes off, the gates open up. True Religion, boom, just trips on the way out. The chances of True Religion catching up to the rest of the horses are zero. Zero. If they trip on the way out, you kind of just had to realize that your money is gone. Don't be True Religion. You know what I'm saying? Like, when the gun goes off in the morning, it's your opportunity to come out the gate running.

With energy and enthusiasm and positivity and better decision-making hypotheses. And so I wanted to put a couple of flagpoles along people's day to make better decisions. And once you start making better decisions consistently, they become habits. So being a creature of habit is ultimately what I am. And, and my story and the business is trying to help people become more of that.

Definitely don't be True Religion, because I don't know what happened to those jeans. They like disappeared, although I think they're making a resurgence because the 90s, like our generation's cool again. Isn't that wild to think of the '90s? Like everything that made me nerdy and not have friends in the '90s is like what people think is cool now. You were in the restaurant business, which I've heard is, can be a very small profit margin, can be a very, very difficult business. Like we've seen You know, the best 3 Michelin star restaurants go out of business, and then you're going into CBG, which I've also heard can be a very, very difficult business. Do you think about these things, like, as you've transitioned through doing— having some exits, some incredible exits in the restaurant space, to then going into CBG, knowing that there's obviously this possible margin, you know, lower margin, high marketing, uh, this is super competitive. What were you— did this go through your mind? Did you think about these things as to when you made the decision, like, this is what I want to do next?

Every business is hard. It's just a fact. Maybe not OnlyFans. That's true. OnlyFans might not be the hard one, but traditionally every business is hard. If I, if I spend too much time looking at the data, I get left in the dust. And I, so I have people, I surround myself with people that really do take time to look at the data. I really am a gut guy. And, um, if the data is strong enough and the people around me's voice is loud enough to derail what I want to do, I listen. But typically I do what I think is the right thing to do or the best thing to do. And when it came to launching, well, when it came to the restaurants, it was, it was all I knew and I loved the business so much. And so my gut was right for me in the world of restaurants. When it came to CPG, I knew that my story was strong. That the product was strong and everybody told me it's a really hard business.

Do you think you want to prove people wrong? Like, do you think entrepreneurship sometimes is proving people wrong? Because I have that feeling.

No, for me it's basically like, uh, the amount of times people told me that I was not going to be able to do something far outweigh the times that people told me I was going to be successful. For like, like, like 100 to 1. And so, and I think a lot of people unfortunately are easily influenced and will allow what something says on paper. 'Cause like you can make a P&L say anything you want it to say. You could, you could put a formula in there and say you're going to make $100 million. You could put a formula in there that say you're going to be negative EBITDA, right? Like, you know, paper and mathematics. Uh, only can go take you so far. There is soul that is required in business. Business without soul, business without culture, in my opinion, is dead no matter how you slice it. And, um, and, and that goes to for all businesses, like the most culturally focused insurance broker is going to be more successful than the soulless insurance broker. And so I sort of use my God-given skills, which is to inspire people, to create environments, products, and services that people— that I know people enjoy, to make them fun, make them cool, get a team to rally behind it, ask for as much help as humanly possible.

So much so that it's painful for me at times, the amount of help I ask for and then take the leap. Like I'm not afraid. Failure is not something that I don't appreciate, but I walk into every single day of my life thinking that I'm going to win. And I mean, I'm a New York Giants fan for crying out loud. I'm, you know, I, but every Sunday morning I think we're winning. So like, that is just my mentality. And I think the difference between a good entrepreneur and a great entrepreneur is the ability to withstand an abnormal amount of adversity and stress and anxiety and come back the next day with a smile on your face. That is the difference between a good and a great entrepreneur. Because like you said, I go to war every day. Every day. Every day I go to work and I get— yeah, I get good news and I get bad news. But when the bad news comes, the way I'm going to be successful is how I handle it.

You know, this crazy part is like sometimes the month could be going horrible until like the 25th day, and then the last 5 days of the month could be the best month ever. That's what That's what people that have a job don't understand. When you have a job, typically, maybe you have commissions, but you get a paycheck. And I mean, things in the job, but when it comes to the pay, it could be, it's kind of the same. Now, when you're an entrepreneur, like literally you could make zero, you could be negative, like 10 times negative up until the 29th day. And that 30th day, deal closes or whatever closes or whatever it is. You get into a retail store, you're in every Costco, you sell the company. Now you're 100x. You, you touched on something about, uh, about you, and I think people follow you. My final question for you, people follow you just like when I was there, we were talking to Gary Vee, who I know you've had a connection with as well, and he's obviously always talks about his personal brand online. I know this has been something helpful for you.

How has having a personal brand and building that up for you helped in business?

I launched Creatures of Habit off the back of my personal brand. When a pandemic hits, when there's a natural disaster, when the stock market crashes, when, uh, your business fails, no one can take your personal brand away from you. They can't. It's impossible. It is not failable. It's a failproof business model. Personal brand. And so, and it, and, and if you do it right and you put energy towards it, it can add an enormous amount of fuel to fire, especially if you have a great network. So I believe entrepreneurs should really start thinking about, if they haven't already, building a personal brand because the value is enormous. And, you know, I'm involved in a bunch of different things. Creatures of Habit is my 95% time focus, but 5% of my life is really focused on my personal brand. And, and that's, and I've done, and I've figured out a scientific formula that works with where I'm able to just spend 5% of my life on my personal brand and it makes a loud noise. And so because of that, I am involved in 15 15 other brands at all times and the flywheel effect of me creating content for other brands.

They find out who I am. They look at me, they find out my business. It's much better with it than without it. And so I believe that personal brand is, is, um, is just a massive asset and no one can take it from you. I mean, the Grim Reaper, you know, that's true.

They, I, we got the secret sauce today. So thank you for sharing that. At another point, I'd like to understand more about, you know, if, if you're allowed to share on another day, what is the secret? But Michael Chernow, love the bar. I love the bar. I ate a couple of those bars. I was so hungry when I met you, crazy. And I was starving, ate the bar, felt good. Love the creatine in there. Uh, so if people wanna get in touch, they want to, obviously they need Creatures of Habit in their life. How can they? Get it.

Yeah, just check out Creatures of Habit at creatureshabit.com. It's Creatures with a K. They can, uh, check us out on all social media platforms. I'm @MichaelChurnow everywhere. Um, the Daily Bar is awesome. It's really good. It's all clean ingredients, plant-based, 20 grams of protein, 3 grams of creatine. I know for sure that this is gonna be the, the, the product that really sort of is our catalyst, um, for scale and growth. And so I would encourage anybody listening to this to just give it a shot, whether you're a protein bar person or not. It's a really delicious, super, super tasty midday snack that will tie you over and you can feel good about eating it.

Well, I've had it, but thank you so much, man. I, I can relate to a lot of your story. Always inspired. I, I want to be a creature of better positive habits. So thanks again for joining us and great to see you.

Thanks, man.