Quantifying Kindness

A Conversation with KIND Snacks Founder, Daniel Lubetzky

Is it possible to quantify “KINDNESS”?

More to the point—if your entire business, your entire brand, is built on kindness, is that something people are willing to pay for?

That’s the question at the heart of today’s episode and my conversation with Daniel Lubetzky, founder of Kind Snacks LLC. Daniel is best known for the snack that turned a simple idea—healthy, transparent ingredients–into a billion-dollar brand.

But Daniel isn’t just a snack bar mogul. He’s a social entrepreneur — one who has spent decades threading the needle between mission and market reality. 

Throughout our conversation, I kept returning to Daniel’s question. If you have a company that strives to be, in their own words, “Kind to one’s tastebuds, body, and the world” -- can you tease out when it pays to be kind? When can moral imagination run its course, and when is it best reigned in by pragmatism?

In this episode and our corresponding newsletter, we explore lessons on how an entrepreneur with a deep sense of mission marries that value-driven imagination with a kind of market pragmatism of what is possible.

“Once you have the authentic purpose, it's really good to be introspective and really really understand at which point are those things at odds and at which points are they're actually in unison.”

In the sections below, I pull out a few threads from our chat that I think you might enjoy. If you are interested in hearing more, give a listen to the full episode!

The Balance Between Business and Social Good

What I hadn’t realized before our conversation was just how deeply Daniel’s work has been long rooted in a social mission. Back in his Stanford Law days, what began as a policy thesis—an academic exercise—somehow morphed into a commercial venture.

That’s the pattern you see again and again with Daniel: he starts with the problem, not the product. He doesn’t begin by asking, What’s the business? but rather, What’s the best mechanism to solve a particular challenge?

And then, crucially, he adapts—because whatever the first idea is, it never survives contact with the real world. It has to evolve, through partnership, through iteration, through the sheer force of figuring it out as he goes.

Here is Daniel in a clip from our conversation:

So theoretically, PeaceWorks, my first company, was beautiful because it advanced the purpose and the business at the same time. It was cooked up into the business model. I partnered with Israelis, Palestinians, Jordanians, Egyptians, and Turks to make products crafted through cooperative efforts among neighbors striving to coexist. And so the more that people were buying that sundried tomato spread, the more I was helping the bottom line, but also I was helping advance cooperation among these neighbors. So the business and the civic objectives were completely tied. But even then, it was really really hard to find the right supply chain because my standards were very rigid. And so it was very hard for PeaceWorks to scale and to grow because I had very limited ability to identify the partners. There were all these rules for what would constitute a partner and the social mission ended up hurting the business mission because it was very hard to qualify and find partners. I learned to slightly adjust that and rather than finding only people that co-owned, co-operated, and co-managed all of the venture, you could be trading partners where Israelis and Palestinians, as long as they were equal partners on the same level, they could work with each other. But so you do need to have that introspection and analysis to be able to fine-tune that.

Growing a Business with a Social Mission

For many business owners driven by social mission, the ultimate question is stark: can their vision survive as a viable business model? Take something seemingly straightforward, like offering above-average maternity leave. The key question is whether this initiative can also lead to tangible business benefits – perhaps through improved employee retention – that justify the investment. It's about discovering how to make social good function within the constraints of a commercial venture.

I initially got to know Daniel through a shared connection with the New York restauranteur, Danny Meyer. For Danny, this tension came up when his team at USHG had to determine if a no-tipping strategy meant to drive back-of-house pay equity could work as a business model.

For nearly five years, they tested this model. But despite the noble intentions, Danny, along with executives Chip Wade and Patti Simpson, ultimately had to reverse course. As Danny put it, they simply couldn't make the math work. (If interested, you can read more on the case we wrote up about that challenge here, and see coverage on the pullback in the NYT here).

So, what was the relevant math for Daniel? At its core, his question was deceptively simple: would people pay more for his triple promise of kindness – to their tastebuds, their bodies, and the world? And if so, how much more?

Let’s return to our conversation:

Kind, the concept is to do the thing for your taste buds, for your body, and for your world. Taste buds mean the product has to be delicious. Kind to your body means the product has to be nutritious. And kind to your world is the how. How do we handle ourselves to try to make this world a little bit kinder, one step at a time? That's how I used to do it when I was running Kind day-to-day. We found that what drove our sales was the first two, the taste and the health. The social mission gave people more love towards the brand, but it didn't drive sales. So we had to adjust because sometimes we were over-adjusting, spending way too much time pursuing the social mission. We had to learn that the social mission should not crowd out the features that people are looking for in the product.

Put another way, sometimes the obsession from the financially driven investors can actually help you to focus and separate the brands, the opportunities, and the cultures.

One might assume that this kind of financial discipline would strangle a company's mission. But my conversation with Daniel revealed something different. While financial constraints can certainly squeeze out idealistic goals, they can also create something valuable: focus. The pressure to make the numbers work forces a company to get crystal clear about what its mission really means – and how to deliver on it.

The Evaluation of an Investor’s Time Orientation

Most business owners don't walk their path alone – they move forward with partners, both financial and strategic. We explored this reality recently in our conversation with Ring founder Jamie Siminoff (available in our podcast and newsletter).

In Daniel's case, finding a partner with the right time horizon proved crucial. This led him to BDT, a merchant bank founded by Byron Trott who you can read about here. Trott’s firm eventually partnered with Michael Dell’s family office (now named BDT-MSD), the latter of whom is more likely a household name (or computer).

Listen as Daniel explains what makes this firm different – and why their perspective on time matters so much:

After my first investor, I ended up buying back some of the shares. It was at that point that I brought back in BDT to support this effort.

A few years later, when I realized that it was important to do a strategic transaction with a global partner, BDT behaved very differently. Instead of an earlier investor that pushing things on me, BDT honored me by actually helping me get that deal done. They were not forced or required to sell some of the shares, but they did so to facilitate my transaction.

Put another way, they ended up doing things that were theoretically against their financial interests. They could have like nickel and dimed me and they didn't. And guess what? They got a friend for the rest of their life. By approaching me as a long-term partner, they absolutely benefited their fund far more, even though they could have probably gotten another half a turn. They did the elegant thing, and that's just fundamentally different than how that first fund behaved and how BDT behaved.

In many ways, investor behaviors like those mentioned are linked to the person involved and the culture of the firm. But there's something even more fundamental at work – structure. How an investment firm is built often predicts exactly how it will act when tough decisions arrive.

Last week, WashU hosted a major case competition with ten finalists. To judge their work, we brought together an exceptional panel from Permanent Equity, Broadview Group Holdings, and the WashU Investment Management Company.

What struck me most about these judges wasn't just their integrity – it was how their organizations' structures enabled their long-term thinking. Permanent Equity offers a great example: the firm’s 27-year fund and strict no-leverage policy enable a different kind of partnership that you might not see with another kind of firm. Their founder, Brent Beshore, breaks this down thoughtfully in a podcast you can listen to here.

Crafting and Sustaining a Culture of Ownership

Perhaps unsurprisingly, given the title of this Substack, I’ve become a bit obsessed with the idea of ownership—where its power lives up to its potential and where it falls short.

One question relevant to this work is whether a culture can generate a kind of “owner’s mentality” — something that goes beyond just showing up for a paycheck and instead fosters a deeper sense of responsibility and engagement. What separates those who take real ownership from those who simply go through the motions?

Daniel, I think it’s fair to say, shares a similar focus. So how is this done in practice? What encourages individuals within a firm to think and act like owners, with a sense of agency, rather than passively operating as employees?

As I ran Kind, I'd like to think that I really had a very authentic intention to make sure that we had an ownership mentality and a purpose-driven mindset. Every team member had stock, but not just that, in the culture and how we created it, everybody had a voice that was encouraged to speak up and challenge any bad idea. I think we did a pretty good job at it and I think that's why we won so big because everybody was an owner. Everybody thought as an owner. And the purpose was cooked into our culture.

It was a culture where we understood that there was kind karma and if we did the right thing, we would be rewarded. And so we worked harder at everything. Putting the product in, making the product delicious, and trying to have a social contribution to making the world a little kinder. It was just our culture, it was the how. We had kind and hungry values. Everybody's expected to be hungry in what they pursue, have a commitment to excellence, get more shelf space, and be kind in how they pursue it. Everybody was working together for the same goal.

In an episode later this spring, we will dig into the role of employee ownership (or ownership-like vehicles) in potentially driving this mentality, something that Anna-Lisa Miller has made into a central part of her vocation at Ownership Works.

Show Notes

Thanks as always for reading along!

In our next full episode, I get to share a conversation with Katie Ford, the former family CEO of global modeling agency, Ford Models. I hope you will join us!

If you are interested in learning more beyond the episode and newsletter, please find below a few resources we used in the generation of this episode:

• Social Spin Doctor: Kind Bar’s Daniel Lubetzky Builds A $1.5 Billion Fortune On Do-Gooder Rhetoric

• New Builders initiative looks to fight polarization by encouraging collaboration and alliances

• KIND Foundation Launches 'Empatico' Platform to Connect Students Globally, Foster Empathy

• Frontline Impact Project Is Helping Companies Donate Products To First Responders Who Need Them