Adel Villalobos is the founder and chief executive of a dietary supplement development
and contract manufacturing organization based in the Santa Clarita Valley called Lief Labs. He founded the company in 2008. Villalobos sat down with the Business Journal at Buon Gusto Ristorante in Mission Hills for a power lunch to discuss his career.
How did you get your start in business?
While I was going to school, I worked at Home Depot… the first entrepreneurial itch or intrigue started (because of) this cool friend of mine named Mark. Mark was always talking about starting a business, and we thought he was crazy, but he was fun to hang out with. And he would paint these cool, visionary stories. And I think it was the beginning of getting excited about having your own business… So now I’m getting close to graduating (college), and I now need to get a job in my field, and I got turned down as a forensic scientist at the Sheriff’s Department. I got turned down for pharmaceutical sales because I wanted to do drug development, but a vitamin company that manufactured their own dietary supplements needed to hire somebody who could train their sales force on the benefits of vitamins and minerals. I know that well, so I got the job and I realized not only did I have a knack for it, but I really enjoyed it…Eventually, I worked in the lab. Eventually, I got a job in developing products for consumers. And I really had a passion for understanding consumer health and consumer well-being.
How did you start your first business?
Eventually a friend of mine calls me and says, ‘hey, Adel, let’s start our own manufacturing company.’ And I said, ‘you’re crazy.’ (but) I quit my job, which was a decent job, and now I needed to make money to make ends meet… He says ‘hey, we’re going to manufacture supplements for other companies.’ It turns out that a lot of the brands don’t manufacture their own products… The business lasted about two and a half years, and I ran out of the money that I borrowed. I owed an SBA loan and I owed vendors money, but I didn’t go bankrupt. (I sold.)
What made you want to start Lief Labs?
I was in my mid to late 20s, and I figured I had a knack for it, and I saw what I did wrong. I started a business, and I wanted to be a low-cost leader, but I was too small. I couldn’t compete. I didn’t differentiate myself. The only thing I was going to do is do things at a lower price, which as an entrepreneur, as a business owner, that’s the last thing you want to do. You’ll be beat by established businesses. And I didn’t go bankrupt because I sold it to somebody who was enamored with my passion and my story, and he says, ‘look, Adel, I’ll buy the business. I’ll pay off your debt, you’re not going to get any money, but you got to work for me for the next two years’… I worked for this gentleman for two years. I built him a facility, so my acumen had grown… I said, ‘I’m going to start this again, but I’m going to do things differently.’ I’m a product developer. I help brands develop and ideate products that help consumers take their health matters into their own hands. I empower people to understand that there’s value in increasing their fiber intake, to increasing their protein intake, and so I’m going to start a manufacturing facility. But I realized that I was a product developer first. When I started Lief Labs, I wanted to be different. I’m not a manufacturer. I develop products, and I help you come up with innovative, award winning formulas and products that consumers want to take, and then I manufactured them… (After two years it became) a $2 million company, but I had all the quality certificates of the big ones. That was powerful. I grew every single year, had cash flow every single year for the next 10 to 12 years straight. I grew a company from zero to $100 million in 11 years.
You mentioned differentiating yourself from other firms being key. How did you do this?
We differentiated (the company) by leading with product development, leading with quality and making sure that we cared about the end consumer.
What have been the biggest challenges?
The world doesn’t see the challenges, they only see the successes… 95% of startups don’t get very far. There is real difficulty and complexity in getting a business off the ground, but it’s so rewarding…The first 10 years, if you happen to get past those, there’s a price to pay for that. And I would say it’s the challenges that the sacrifices of not so much time not spent with family, because I did spend time with my kids and family, but it’s really where your mind is during those times, because you’re trying to scale and you’re trying to build what sounds like the impossible…if you’re lucky enough to scale the business, there’s some new lessons there. Just because you scale it to a certain level doesn’t mean it goes on forever.
What’s next for you and the company?
One of my drives is to lead industry. And I happen to be in an industry that I know well, and have done it before, and feel that we have the ability to lead industry… I’d like to use current technology… to lead the industry to higher levels of quality rigors (and) higher levels of innovation. I’d like to embark on a technology journey, one that’ll help us lead the entire industry and bring the industry forward.
