Vendor Case Study Video
MightyGood Solutions Draws Financing Strength From C2FO
August 16, 2021 |
The C2FO Team
The small but fast-growing Kansas City maker of specialty products funded its growth during the pandemic through early payment and C2FO’s Capital Finance.
In 2012, Ben Rendo was working in corporate finance when he decided he wanted to pursue something different.
“I’d had an idea for a long time for a product that you could use to carry all of your grocery bags in one trip,” Rendo, co-founder and president of MightyGood Solutions, said. “I was thinking about it a lot more in my day job than I was probably doing my day job.”
So at the end of 2012, Rendo quit his job. He and his wife emptied their 401(k) plans and sold their house to fund what was MightyGood Solutions’ first product: an anchor-shaped piece of plastic that allows shoppers to comfortably carry multiple bags in one hand.
The Mighty Handle quickly drew the attention of Walmart, Target and Kroger.
“The Mighty Handle is what really started off the entire company. Ben actually noticed a need for that when he lived in a walk-up apartment in downtown Kansas City,” MightyGood CFO Justin Koebel said. “And it just dovetailed from there.”
Solutions that are mighty good
In the company’s early days, Rendo and his single employee at the time (VP of Product Taylor Jay) would sit around and try to identify mundane, everyday problems and come up with a solution — hence MightyGood Solutions’ namesake.
The Dip Buddy, a reusable dipping sauce container that attaches to your plate, and the Pizza Saver, a half-moon-shaped container with triangular compartments for easy slice storage and reheating, are just a few of the niche impulse items they created that still perform well for the company today.
However, Rendo knew MightyGood would one day need to pivot to a line of business that would keep customers coming back.
A pivot during the pandemic
The onset of COVID-19 kick-started MightyGood’s pivot from primarily manufacturing injection-molded plastic products to making pandemic-related supplies, including hand sanitizer, disinfectant and flushable wipes.
With cheeky names like “Sanitize Those Hands” and “Wipe That Tush,” Rendo said MightyGood wanted to differentiate itself from its competitors’ clinical and often stale-sounding products.
“We want our shoppers and our customers to know that while these products are important and they keep you safe, it can still be fun,” Rendo said. “We don't take ourselves too seriously.”
The company also started making face shields and donating them to charitable organizations and medical facilities in the Kansas City area.
“It was in no intention to try to get good PR. We wanted to do something that could help others,” Rendo said. “And sometimes we do the next right thing, and it really opens doors.”
That open door was an opportunity with Sam’s Club to make three-ply face masks for the retail giant.
“That led to making hand sanitizer for Sam’s Club and caused a pretty substantial expansion of our business,” Rendo said. “Our growth was rapid from 2019 to 2020 — we grew nearly 8,000% percent.”
Staggering growth and challenges
Landing on big-box retailers’ shelves with niche products may have catapulted the startup's traction, but MightyGood’s focus on "doing the next right thing" has propelled the consumer packaged goods manufacturer to the No. 1 spot of Kansas City’s fastest-growing companies.
But with staggering growth comes challenges. Fortunately, Walmart offered an early payment program through the C2FO platform.
“C2FO's early payment program allowed us to be more aggressive in choosing to work with supply chain partners that would provide us with a higher margin,” Koebel said. “So far, we've accelerated every invoice available with Walmart and Sam's Club.”
MightyGood also uses C2FO’s Capital Finance, which provides lending solutions from a network of funding partners that integrate seamlessly with early payment programs. With C2FO, MightyGood can turn its accounts receivable into immediate working capital and access asset-based lending seamlessly, Koebel said. This is crucial as the company prepares multi-year contracts with sizable medical product distributors, producing sterile surgical wraps, nitrile gloves, syringes and more.
“Capital Finance has been essential for us. We're a small company and, while we had extensive growth last year, it doesn't mean that that necessarily turned into working capital or cash,” Koebel said. “Capital Finance has been instrumental in being able to navigate the unforeseen waters for us. I was blown away by their ability to come up with advanced rates that truly met our needs.”
Rendo said MightyGood is using the income from early payment with C2FO to reinvest in products that are used in everyday health care settings and prepare for its next stage as the fastest-growing company in Kansas City.
“If we didn't have early pay with C2FO, we would have been waiting 90 to 100 days to be paid. We couldn’t have taken on new opportunities, and those new opportunities are what really contributed to our growth,” Rendo said.