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November 1, 2023

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Meet Khai Pham, a visionary entrepreneur reshaping how we manage lactose intolerance.

Armed with a business degree from USC, Khai’s journey took an unexpected turn after an eye-opening internship experience. After leading strategy and operations at a tele-orthodontics startup, he took the big step to start his own venture: Milky.

Milky stems from Khai’s personal struggle as a lactose intolerant person. Collaborating with Dr. Michael Seidman, he created Milky, a revolutionary lactase supplement designed for convenience and portability.

The path to Milky’s creation was marked by challenges. Khai and his team encountered manufacturing hurdles and setbacks, but their unwavering dedication and problem-solving spirit prevailed. Join us as we delve deeper into Khai’s journey with Milky.

KHAI PHAM’S JOURNEY WITH VENTURE FOR AMERICA

Venture for America profoundly shaped Khai’s career. Khai revealed the exceptional prospects that startups offer compared to larger corporations. In bigger companies, promotion chances often hinge on the person above you advancing or departing. However, in startups experiencing rapid growth, the entire business expands, creating numerous opportunities.

As a result, Khai’s hard work earned him two well-deserved promotions in just one year, leading him to become an Associate Director, with his initial compensation increasing four times by the time he turned 23. More importantly, Khai was able to engage with more substantial challenges much earlier in his career.

LEADERSHIP LESSONS AS YOUNGEST DIRECTOR

Climbing the ranks at Candid and achieving the distinction of being the youngest Director brought both challenges and growth to Khai Pham. In his perspective, the most demanding aspect of this journey was the increasing gap between decision-making and its outcomes. During the earlier stages of one’s career, tasks are straightforward; you receive assignments like crafting financial models, and when you perform well, immediate feedback follows. That immediate validation is comforting for junior professionals.

However, as one advances into more senior roles, the time gap between decision and result widens significantly. Senior leaders must make weighty choices, such as shaping the market strategy for a new product. Yet, the effects of these decisions might remain concealed for months, even years. This adjustment, bridging the gap between choices and their eventual outcomes, is a formidable mental challenge that confronts most individuals, Khai included. This evolution in leadership style and responsibility marked Khai’s journey as he navigated the complexities of decision-making at Candid.

KHAI’S PERSONAL STRUGGLES THAT LED TO THE BUSINESS OPPORTUNITY

Khai Pham’s personal battle with lactose intolerance ignited the creation of Milky, a transformative lactase supplement.

Khai shared that aside from being lactose intolerant, he also coped with ADHD, which often led him to forget bringing a Lactaid, making casual outings for ice cream, boba, or pizza very hard. Though the idea of a more portable version of Lactaid had crossed his mind, Khai initially didn’t see it as a true business opportunity.

When Khai moved to New York and found his favorite boba shop, Machi Machi, in Koreatown, he kept running the same problem of forgetting his Lactaid. He also noted that the pharmacy in Koreatown always seemed to run out of Lactaids. “Lactaids fly off the shelves at their location,” one of the pharmacy’s employees said. Intrigued by this, Khai went to visit various drug stores across lower Manhattan, asking their employees about Lactaid sales.

Khai shared that the farther he ventured from Koreatown and Chinatown, the less frequently stores experienced Lactaid stock shortages. This was the moment that Khai recognized his idea of a super-thin lactase supplement as a viable business opportunity, setting in motion the Milky journey.

“What I slowly began to realize is that people can’t help you if they don’t know you need help.”

Khai Pham

THE EXPONENTIAL POWER OF NETWORKS

Khai Pham’s collaboration with Dr. Michael Seidman marked a turning point for Milky, their second joint venture. Many wonder how a board-certified surgeon like Dr. Seidman came to co-found a company with Khai. The answer is simple: asking for help.

“I used to play it close to the chest when I was starting a company because I didn’t want to be embarrassed if it didn’t work out. What I slowly began to realize is that people can’t help you if they don’t know you need help,” Khai shared.

With this profound realization, Khai began sharing his desire to start a dietary supplement business with his coworkers and his search for a scientific co-founder. One day, a coworker mentioned a friend whose father, Dr. Seidman, had both a medical background and a penchant for formulating ideas. And the rest was history.

How Khai and Dr. Seidman met illustrates the exponential power of networks, but only if you open up and tell people that you need their help.

KHAI’S INSIGHTS IN NAVIGATING ENTREPRENEURSHIP

When asked what advice he would offer to his younger entrepreneurial self, Khai Pham emphasizes that failure doesn’t equate to poor decision-making. He notes that while they are connected, making the right choice with the information at hand doesn’t guarantee success.

Khai’s experience has taught him that if a decision carries even a 10% chance of yielding a 1000x return, it’s worth taking that calculated risk. Even if it doesn’t pan out, it doesn’t make the decision wrong. He candidly shares that in his earlier career, he often focused on the immediate results of his actions, sticking to high-probability decisions, and missing out on better, higher-expected-value opportunities. For Khai, the key metric for decision-making is expected value, not just the probability of success, a lesson he holds close as he navigates the entrepreneurial landscape.

MILKY’S VISION TO REVOLUTIONIZE DIETARY ACCESSIBILITY

When contemplating the future of Milky, Khai envisions creating an entire ecosystem of dietary accessibility.

While Milky’s initial focus centers on lactose intolerance, Khai recognizes that many individuals face a variety of dietary restrictions, including issues like acid reflux. The prevailing frustration lies in the disconnect between scientific solutions and user experience. Drawing a parallel to Lactaid, Khai points out the impracticality of carrying around large plastic bottles of products like TUMS.

The Milky team aspires to create a world where your entire medicine cabinet can be conveniently carried in your pocket, offering a seamless solution to dietary challenges, thus transforming the lives of those managing lactose intolerance and other dietary issues.

CONNECT WITH KHAI / MILKY

Instagram: @shop__milky

TikTok: @milky

Linkedin: Khai Pham

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Pauline (left) and Olivia (right)

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Roadshow Or Small Rotation

We met our buyer at Expo West (Think Super Bowl for the Food & Beverage industry where retailers and manufacturers meet up. Super worth doing if you are in CPG. We even landed our 1st TV interview).

After Expo West, we sent more samples to the office and began negotiations for placement. We were offered two ways of being at Costco:

Roadshow

  • 4 days of selling on consignment. We could control costs by using our own people and decide the volume of product we wanted to bring in.
  • Typically, this is how small brands enter Costco. If it does well, you are offered a rotation. If you don’t do well, then it’s really hard to get into the regular set.

Small Rotation

  • We started with a number of stores and the item is part of the regular set.
  • This is harder to secure because Costco is paying for the inventory and the buyer has to believe in your product.

In both situations, it is critical that Twrl Milk Tea sells well and ideally sells out. Why is this important?

It proves to the Costco Buyer that there is a market for our better-for-you plant-based milk teas. More importantly, companies owned by Asian American small business owners like ours are proven to be great partners worth investing time in and onboarding.

Reasons For Opting for Small Rotation

After a few weeks of due diligence on our end, we decided to go with a small rotation. Our reasons were simple:

  • Our manufacturer could produce the volumes needed and in the time we needed. Not always the case in this crazy supply chain. We are made in the USA so it makes a huge difference in our speed for delivery.
  • We could handle the financial obligations to fund the inventory. It’s a lot of money upfront so it’s not a light decision for a smaller company like ours. And, there is still a chance you can be sitting on inventory if it does not sell through.
  • We are committed to Costco and wanted to be part of the regular set and did not want to take the chance that with Roadshow which is only 4 days could be a bust due to so many variables that we may not be able to control.
  • We love Costco ourselves and shop there regularly so we saw our consumers there! Did you know the typical Costco shopper is 35-44 years old, an Asian female making $125,000 and the average trip is $114?!

Roadshow which is only 4 days could be a bust due to so many variables that we may not be able to control.

-Olivia Chen

Decisions, Decisions, Decisions

What flavor to sell?

Out of our 3 flavors, we selected Taiwan-Style Black Milk Tea to launch because it’s one of our best sellers and our Taiwan-Style Black Milk Tea flavor is really unique. Our single-origin loose-leaf black tea is a one-of-a-kind varietal, sourced from a small multi-generational family farm on a misty slope, fed by sweet mountain spring water.

Our tea flavor, aroma, and health benefits are un-parallel to anything on the market. We use pea milk and lightly sweetened our teas with organic agave so our tea flavors really come through. Only 45 calories & 6g of sugar per can.

What would the packaging look like?

Packaging design and sourcing begin for Costco. Luckily for us, Pauline Ang is a seasoned graphic design guru (with 15+ years in the food and beverage packaging for Fortune 500 companies) and designs all our packaging in-house so we could save costs and time here!

How to onboard?

Mountains of paperwork for our two-person team begin. We didn’t use a broker and did everything ourselves. Yes, a broker would have been so incredibly helpful to answer all the questions that we didn’t know the answers to and definitely would have saved us some headaches.

Big Takeaways

  • Don’t be afraid to chase the account you want to be in. Don’t be shy about sharing your vision of where you see the company. Special thanks to Ryan Sung of Honolulu Cookie Company and Vincent Kitirattragarn of Dang Foods for talking to us about their journey with Costco and encouraging us to go for it.
  • It can be done without a broker but not without headaches and some huge learning curves and we did make some mistakes along the way.
  • Have an advocate. We have been super lucky that our buyer has been so incredible to work with and it’s important to have such an advocate in the company. Cannot over-emphasize this enough!
  • Your team matters. Grateful to share this journey with Pauline Ang who is such an amazing friend and business partner. We are two moms that love Milk Tea and simply wanted to make milk tea —a quintessential Asian drink that we love—even better.

Don’t be shy about sharing your vision of where you see the company.

-Olivia chen

Connect with Olivia and Pauline

Your support would mean the world to our small business and the small family farms that use sustainable practices for a tea that’s better for you, and better for the planet. Follow our journey: Instagram, Facebook, TikTok, Twitter

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