Magic Spoon & Exo: Gabi Lewis and Greg Sewitz
Key
- Organic Foods: The mainstream trend in the traditional healthy food market
- Low-Sugar Low-Carb: The core demand of the emerging healthy diet
- Crickets Protein: An innovative attempt at sustainable protein sources
- High-Protein Cereal: The core product positioning of Magic Spoon
- Food Supply Chain: The main obstacle to the commercialization of insect protein
Abstract
After graduating from Brown University, Gabby Lewis and Greg Sebbets explored sustainable protein sources through the Cricket Protein Bar (Exo) project but failed due to supply chain bottlenecks and consumer psychological barriers. In 2019, the two turned to developing high-protein, sugar-free, low-carb breakfast cereal (Magic Spoon) to address the decline of the traditional breakfast market and the trend of healthy eating. Through an innovative formula of natural sweeteners (such as allulose) and whey protein, Magic Spoon successfully entered thousands of retail stores and received tens of millions of dollars in financing. This transformation highlights the market evolution in the food industry from organic foods to functional foods and the resilience of entrepreneurs to iterate after failure.
Insights
Driven by both health consumerism and sustainable development, the food industry is undergoing a paradigm shift from the "organic label" to the "ingredient revolution." The case of Magic Spoon shows that:
- Upgraded consumer demand: The traditional "organic" concept can no longer meet the precise demand for low sugar and high protein, prompting companies to develop more complex alternative solutions.
- Challenges in supply chain reconstruction: The failure of cricket protein reveals the dual challenges of large-scale production and social acceptance that emerging protein sources need to address from the laboratory to commercialization.
- Value of emotional marketing: Magic Spoon combines functional foods with emotional resonance by replicating the childhood cereal memory, providing new ideas for opening up the mass market for functional products. Future food innovation will rely more on cross - domain technology integration. For example, the combination of synthetic biology and food technology may reshape the protein production landscape.
Views
01 "The Dual Dilemma of Cricket Protein"
The founders admitted that although cricket protein has environmental advantages (using only 1/10 of the water compared to beef), the lack of large - scale farming infrastructure in the United States has led to high costs (the cost of cricket powder per pound is three times that of beef). Consumer psychological rejection has become a "fatal obstacle." Even if the product has a neutral taste, it still needs to break through the cognitive barrier of "eating insects."
02 "Market Saturation of Organic Foods"
The podcast pointed out that in 2024, the organic food market has entered a "red ocean," with organic versions available in almost all categories. Entrepreneurs must break out of the single narrative of "organic = healthy" and turn to solving modern dietary pain points (such as blood sugar control and gut health).
03 "The Innovation Logic of the Cereal Category"
Magic Spoon uses a combination of protein to replace carbohydrates (each serving contains 12g of protein and net carbs < 5g) and natural sweeteners (allulose + monk fruit) to meet the needs of fitness enthusiasts while avoiding competition in the children's market. Its positioning as "adult cereal" precisely targets a niche market overlooked by traditional brands.
In - Depth
From Crickets to Cereal: A Paradigm Shift in Food Entrepreneurship
In 2013, Gabby Lewis and Greg Sebbets had an entrepreneurial idea in a math class at Brown University. Their initial idea of a natural protein bar (made from dates, cocoa, and nuts) received a lukewarm response in campus tests. It wasn't until Greg proposed adding cricket powder that this "crazy" idea truly ignited their entrepreneurial passion. The high density of cricket protein (containing 60% protein) and its environmental attributes (reducing carbon emissions by 90% compared to traditional livestock farming) made it a sustainable protein source strongly promoted by the United Nations Food and Agriculture Organization. However, when the duo raised $60,000 through Kickstarter in 2014, the harsh reality quickly emerged.
The collapse of the supply chain became the first hurdle. At that time, there were only family - run cricket farms in the United States, lacking industrial production standards. The founders had to fly to Louisiana to persuade farmers to set up a dedicated breeding area for them and insisted on using organic feed. Even so, the cost of cricket powder was as high as $12 per pound, far exceeding that of traditional protein powder. What was even more fatal was consumer psychology - even though the product had a neutral taste, the label of "eating insects" was always difficult to shake off. In 2018, Exo was acquired for $5 million, marking the end of this experiment.
Breaking the Deadlock in the Cereal Track: Replicating Childhood Memories with Technology
In 2019, the two founders turned their attention to breakfast cereal. Although this category has a market size of $1.1 billion, it has stagnated in growth due to its high sugar and high - carbohydrate content. Magic Spoon's strategy is to use technological means to replicate the "happiness" of childhood cereal while addressing modern consumers' concerns about nutrition. Its core breakthroughs are as follows:
- Protein replaces carbohydrates: Whey protein and tapioca starch are used to reshape the texture of the cereal. Each serving contains 12g of protein and net carbs < 5g.
- Sweetness revolution: Allulose and monk fruit are used to replace sucrose. The former provides a sweet taste similar to sucrose without raising blood sugar, and the latter has zero calories and no bitter aftertaste.
- Emotional resonance design: Classic cereal flavors such as fruit flavor and cinnamon flavor are launched to evoke consumers' nostalgic feelings for childhood breakfasts.
The Commercialization Path: From the Laboratory to the Retail Shelf
Magic Spoon's financing strategy is in sharp contrast to that of Exo. The latter relied on Kickstarter and angel investment, while Magic Spoon received a $1 million investment from venture capital institutions such as Collaborative Fund at the beginning of its establishment in 2019 and locked in channel resources in advance through health influencers. Its product development cycle lasted 18 months, during which more than 200 formulas were tested. Finally, a base with whey protein (70%) and inulin (30%) as the core was determined. In 2020, Magic Spoon entered chain supermarkets such as Whole Foods, and its retail sales exceeded $100 million in 2023.
Future Outlook: The Evolution Direction of Functional Foods
Magic Spoon's success reveals three major trends in the food industry:
- Ingredient transparency: Consumers' sensitivity to ingredients such as "sugar" and "gluten" continues to rise, forcing companies to use more precise nutrition labels.
- Technology - driven innovation: The commercialization of new sweeteners such as allulose marks the shift of food technology from "auxiliary" to "core."
- Cross - category integration: Magic Spoon combines cereal with protein bars and meal replacements, indicating that the boundaries between food categories will be further broken.
Although Magic Spoon has not yet turned a profit, it has verified a key proposition: through the dual path of technology + emotion, functional foods can break through the stereotypical impression of "healthy asceticism" and become mass - consumer products. In the future, with the maturity of technologies such as cell - cultured meat and plant - based protein, the imagination of food entrepreneurs will continue to expand.